secretary of defense corporate fellows final outbrief academic year 2008-2009

Secretary of Defense Corporate Fellows

Final OutbriefFinal Outbrief

Academic Year 2008-2009

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Fellows and AssignmentsFellows and Assignments

Col David Zorzi, USAF Booz Allen HamiltonMcLean, VA

Col Robert Schutz, USMC FedEx ExpressMemphis, TN

Col Scott Pleus, USAF Sun MicrosystemsMenlo Park, CA

CAPT Joseph Leonard, USN Northrop Grumman Electronic SystemsLinthicum, MD

Col William Harrop, USMC Georgia Power Atlanta, GA

COL Patrick Mason, USA Sikorsky AircraftStratford, MA

LTC David LaGraffe, USA Sarnoff CorporationPrinceton, NJ

Lt Col James McCreary, USAF Johnson & Johnson CorporationSkillman, NJ

CDR Darrell Lack, USN Raytheon CorporationMcKinney, TX

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AgendaAgenda

• Program Overview• Current Environment• Observations & DoD Recommendations• Discussion / Q&A• Individual Experiences (FYI)

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SDCFP BackgroundSDCFP Background

• SECDEF concerns for future Service leaders– Open to organizational and operational change

– Recognize opportunities made possible by info tech– Appreciate resulting revolutionary changes underway

• Affecting society and business now• Affecting culture and operations of DoD in future

• Businesses outside DoD successful in:– Adapting to changing global environment

– Exploiting information revolution

– Structural reshaping/reorganizing

– Developing innovative processes

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SDCFP BackgroundSDCFP Background

• DoD needs effective access to best executive level business practices applicable to operations & support

– Strategic Planning– Organization– Change Management– Human Resources– Information Technology– Supply Chain– Outsourcing

• Infrastructure approximately 2/3 of Defense Budget– Reforms generate savings– Savings applicable to operational shortfalls

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SDCFP OrganizationSDCFP Organization

• Two or more officers from each Service– High flag/general officer potential– O- 6 or O- 5– Senior Service College credit

• Group Education– Current political/military issues; leading edge technologies – Meetings with senior DoD officials, business executives, Members of

Congress, the press, former sponsors, alumni– Graduate business school executive education

• Eleven months at Sponsoring Company

• Permanent Staff– SDCFP Director– Net Assessment for oversight– National Defense University for Admin support

• www.ndu.edu/sdcfp/sdcfhom.html

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SDCFP ResultsSDCFP Results

• Program objectives fulfilled– Education

• DoD, individual officers, Sponsors

– More Sponsors than Fellows available

– Intra-group experience sharing• Group visits with sponsor CEO’s and senior leadership

• Unique corporate experience– Strong corporate support

– Executive/operational level duty mix

– Mergers/restructuring• Unexpected challenges, valuable insights

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SDCFP SponsorsSDCFP Sponsors

• 08 - Prior– 3M, ABB, Accenture, Agilent Technologies, American Management

Systems, Amgen, Boeing, CACI, Caterpillar, Cisco, CNN, Deutsche Bank, DirecTV, DuPont, Enron, FedEx, General Dynamics, Hewlett-Packard, Honeywell, Human Genome Sciences, IBM, Insitu Group, Johnson & Johnson, Lockheed Martin, Loral, McKinsey & Co., McDonnell Douglas, Merck, Microsoft, Mobil, Netscape, Oracle, Northrop Grumman, Pfizer, Pratt & Whitney, PricewaterhouseCoopers, Raytheon, Sarnoff, Sears, Sikorsky, Southern Company, SRA International, Sun Microsystems, Symbol Technologies, Vertex Aerospace

• 08-09– Booz Allen, FedEx, Georgia Power, Johnson & Johnson,

Northrop Grumman, Raytheon, Sarnoff, Sikorsky, Sun Microsystems

• 09-10– Accenture, Apple, Caterpillar, Deutsche Bank, EADS, DuPont, General

Dynamics, iRobot, NCR

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SDCFP ProductsSDCFP Products

• Build a cadre of future leaders who:– Understand more than the profession of arms

– Understand adaptive and innovative business culture

– Recognize organizational and operational opportunities

– Understand skills required to implement change

– Will motivate innovative changes throughout career

• Report and Briefings directly– SecDef/DepSec, VCJCS, Service Secretaries & Chiefs, 30+ others

– Business insights relevant to DoD culture/operations

– Recommend process/organization changes

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“And we must transform not only our own forces, but also the department that serves them by encouraging a culture of creativity and intelligent risk taking. We need to promote a more entrepreneurial approach to developing military capabilities, one that encourages people--all people--to be more proactive and not reactive, to behave somewhat less like bureaucrats and more like venture capitalists…”

SecDef Remarks

National Defense University

31 January 2002

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AgendaAgenda

• Program Overview• Current Environment• Program Recommendations• Discussion / Q&A• Individual Experiences (FYI)

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Current EnvironmentCurrent Environment

• Tremendous Uncertainty– Crafting strategy during uncertainty challenging

– Unknown recession depth and length add to complexity

• “Leaning Operations”– Working capital depletion (cash struggles)

– Supply chain reduction - “make it happen”

– Sub-tier supplier risk; how much can they endure?

– Product line adaptability for market turbulence

• Network Optimization (Supply and Distribution)– Reducing network redundancy

– Increased risk to business; less adaptability

• Asset Utilization– Refocused analysis of value stream

– “Balance Sheet” reductions

– Short term focused

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Current EnvironmentCurrent Environment

• Extensive Scenario Planning– Hedging for numerous potential futures– Seeking diversified business model

• Time Domain Success– Flexibility and speed to market critical– Capital constrained but still focused E&D spending

• Convergences between Operating Companies– “Salesman” like approach from Corporate to Operating Companies– Linkage of product offerings across portfolio

• Balance of long term and short term – Achieving short term financials challenges the future– Shift to a balanced and sustainable approach– Trending competition difficult; is it true innovation or unsustainable

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AgendaAgenda


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Achieving Excellence - ObservationsAchieving Excellence - Observations

• Strong sense of corporate identity– Relentless branding centered on strong values

• Caring for the world…one person at a time™ – J&J • Southern Style – Southern Company

• Uncompromising ethics • Safety…employees are truly valued • Diversity of thought• Productive work environment • Prioritization of efforts…clear annual goals• Accountability and rewards for results• Recommendations

– NSPS• Stronger incentives for performance • Stick with it; it will pay off

– Broaden inputs for evaluations…team work

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Personnel EvaluationsPersonnel Evaluations

• Current DoD Evaluation Process– Evaluations linked to supervisor input only– Performance appraisals

• Retrospective look at the past

• Focused on past accomplishments

– Not a developmental model• What am I doing/not doing well?

• How do I improve?

• How do I measure improvement?

– No accountability for a mid-year review• No structured process to evaluate for mid-course corrections

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• An Industry Approach– 360 Degree Measurement and Reward System– Formal peer lead assessment

• Input: Up/down, lateral, and customer feedback

• Evaluation criteria– Alignment: Core Values tied to company level objectives– People Development (mentorship)– Competency– Self Development– Voice of the customer

– Competency based career development model• Focus on Knowledge, Skills, and Abilities (KSA)

– Required to advance, move forward, and increase performance

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• Predictable Outcomes: 360 Degree Evaluation– Reduces

• Supervisor Bias (Independent verification of each employee)• Competing interest within Service

– Creates• Specific and measurable development plan• Inherent training

– Assessors, peers, learn what leads to success

• Open and candid performance feedback loop• Results driven review and institution value based alignment

– Promotes• Emotional Quotient (EQ) as well as Intelligence Quotient (IQ)

– Self and social awareness; self and relationship management

• Motivation for helping each other (eliminates stovepipes)• Rewards for teamwork, collaboration, cooperation

• Recommendation– Explore applicability of 360 degree evaluations

• Both uniformed and GS (NSPS) systems

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New Directions in Data Center DesignNew Directions in Data Center Design

• Data center consolidation – Harnesses power consumption, cooling requirements– Reduces real estate footprint

• Current world-wide internet power consumption costs $7.2B annually – Will continue to increase

• Data center's design has evolved considerably – 50%+ annual power savings

• Ultra-thin clients – Improve security – Reduce power consumption, support costs

• Ultra-thin client applications save $70 of energy, per desktop, per year• Enhanced security features, portability, manpower savings, and

refresh rate savings make Return on Investment (ROI) attractive • Recommendations

– Determine ROI for DoD wide datacenter redesign– Re-think PC based infrastructure in DoD

• Power, security, manpower, mobility savings

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Transitioning New TechnologyTransitioning New Technology

• Maintaining U.S. technical superiority key element in U.S. military policy• DARPA mission “Maintain superiority and avoid technological surprise”

– Service S&T focus is near-term– Basic research focus is far-term– DARPA management philosophy, “Bridging the gap.”

• R&D companies confronted with several difficulties– R&D has high uncertainty WRT cost estimates, time schedules– Knowledge/visibility of needed combat capability in R&D companies is not high– DARPA support ends when new tech “demonstrated” – but not field ready– Services reluctant/unable to fund the systems engineering

• Necessary to properly develop new technology into a capability– Corporate perspective – the gap is often not bridged

• Recommendations– Participate fully in Service Materiel Enterprise – Establish Joint organizational element

Relevant Service PEO’s, Combat Developers Enables transfer process of promising capabilities

– Generate organizational momentum

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Technology On/Off-RampsTechnology On/Off-Ramps

• Weapon systems development often fields antiquated equipment– Larger issue than implementation of “open system architecture”

• Driven by differing developmental cycle times– Structures – Propulsion– Avionics – Software– Imagery – Network Connectivity

• Desire to have “tight package” at preliminary and critical design

• Mandate to have cost, schedule, performance, and risk understood

• Recommendations– Identify and flow product cycle times early– Ensure systems engineering plan facilitates technology on/off ramps– Link development to key technology decision points

• More than current technology readiness assessment process – Accept potentially sub-optimized integrated design

• Facilitates greater ease of upgrades and technology insertion

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• Rapid innovation with production in mind

• Need “best source” innovation– Rapidly

• Inside (if we can anticipate), Responsive to, or Countering adversaries timeline /reaction loop

– Cheaply, in large quantities with repeatability and reliability– Supported by parts, technical support, training

• Exportability – How can we prepare capabilities (technologically and policy)?

Production &

SupportRapid

Innovation

DoD

JointWarfighter

Capabilities

External Drivers• Policy shifts• Program shifts/funding• Acquisition reform• Global environment• Innovative Adversary

Positioning for the FuturePositioning for the Future

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• Recommendations– Focus investments in capabilities / technologies that:

• Leverage evolving next-gen. tools and applications – Support real-time decision making

• Have shorter development life-cycles• Are applicable to multiple domains

– Interoperability and integration• Are open

– Architecture, Systems, Source• Are secure

– Tamper proof– Reliable suppliers

Positioning for the FuturePositioning for the Future

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Crafting Incentives for IndustryCrafting Incentives for Industry

• Crafting effective awards/incentives very challenging– Inconsistencies between services & programs– Internal program inconsistencies due to change

• Negative connotation of “award”– GAO perspective of “reward” versus profit– Poor understanding of risk, profit, and program turbulence

• Stagnant government process– Criteria and award strategy not evolving – Award criteria often a second tier activity– No recognition of company impact (good and bad)

• Recommendations– Must be a key discipline taught and discussed at DAU– Establish government / industry cooperative exchange to address incentive methods– Align award/incentive criteria with key program phases/transitions – Obtain contractor feedback of program office performance (360 degree assessment)

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AgendaAgenda


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AgendaAgenda

• Program Overview• Current Environment• Observations & DoD Recommendations• Individual Experiences (FYI)

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• Strategy and technology consulting– Specializations

• Organization & Strategy • Economic & Business Analysis• Supply Chain & Logistics • Intelligence & Operations Analysis• Information Technology • Systems Engineering & Integration• Assurance & Resilience • Modelling & Simulation

– Privately held corporation; founded 1914– 2007 revenue $4B – 20K employees– Annual growth averaged 13% per year for past 15 years

• Great Place to Work Honors – “100 Best Companies to Work For” Fortune, 2005-2008 – “100 Best Companies for Working Mothers” Working Mother, 1999-2008– “Best Places to Launch a Career” Business Week, 2006-2008– “Best Place to Work in IT” Computerworld, 2003-2008

• Assigned to VP, International Defense Cooperation

Booz Allen HamiltonBooz Allen Hamilton

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ObservationsObservations

• Major Investor – Carlyle Group private equity firm– April 2008: Carlyle buys controlling interest for $2.5B– August 2008: Booz Allen buys out Commercial partners (Booz & Co.)– Carlyle holding Booz Allen for growth; operating as silent partner

• Initial Impressions – Unique Culture – teamwork, collaboration, cooperation, service to client

• Culture of ownership and service throughout…similar to military

• Emotional Intelligence (EQ) as important as IQ – Self-awareness, self-management, social awareness, relationship management

• Building “results that endure” with the client, not just what RFP states• Vertical vs Horizontal hierarchy – flexible to serve the market

– Partnership Mindset – decisions made by what makes sense, not profits• One Profit and Loss (P&L) statement for entire firm (unlike all competitors)• Eliminate stovepipes – all partners motivated & rewarded by helping each other • No competing interest within firm

– Core Values• Client service, entrepreneurship, excellence, teamwork, diversity, respect, fairness

integrity, trust, professionalism

• Not just lip service; woven into fabric of firm

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• Team Measurement & Reward system – 360o Evaluations– Supervisors, peers, subordinates– Performance measured on core values– Performance measured on people development, revenue, managing

cost

• Challenges– Carlyle Group’s potential call option– Maintaining unique culture with fast growth

• Predicting continued double-digit growth– Superior repetition in market– Government

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• FedEx Corporation– Operating Companies: Express, Ground, Freight, Custom Critical, Office– Support Companies: Trade Networks, Services, Supply Chain Services

• Strategy– “Understanding how access works is the key to harnessing power”– “The Purple Promise – make every FedEx experience outstanding” – “People, Service, Profit”– Operate Independently, Compete Cooperatively, Manage Collaboratively

• Assignment: FedEx Express– Global Operations Center

• Global Operations, Scheduling, Command & Control, and Planning– Disaster Recovery And Contingency Operations (DRACO)

• Business Continuation, Airport/Hub Reconstitution, Crisis Management

FedEx ExpressFedEx Express

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• Challenges– Revenue generation and recessionary economy– Trend is toward deferred service with lower profit margins– Control costs domestically for increased margins– High capital cost enterprise - replace aging aircraft fleet – Compete with UPS’s single, large, efficient network– Generate seamless enterprise brand with independent operating companies

• Good but not mistake-proof– China expansion delays– Diminished European penetration– Unionization: Railway Labor Act v. National Labor Relations Act

• Superior focus– Mission Oriented– “Only as good as tonight’s sort”– Measure, Measure, Measure -- Record Service Quality Indices (SQI)

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• QDM – Quality Driven Management– “Deliver market-leading customer experience, business excellence, and financial

return through a quality oriented culture and day-to-day application of Quality Science.”

– TQM philosophy without time consuming techniques– Drive QDM culture and process down to individual employee– Common training, tools and techniques – Root cause seeking analysis and continuous improvement mentality– Relentless customer focus (Purple Promise) and matching metrics (SQI)

• Leadership– Pragmatic leadership and managerial culture – Operational excellence– Fast and adaptable– Supported by strong company identity– Excellent information access– Emphasis on learning, freedom of action, and employee participation

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• Worldwide network computing infrastructure solutions– Primary products segments

• Core: SPARC/X86 systems, storage, Solaris, JAVA, MySQL• Service Provider: private & public cloud computing, data centers• Professional Services

– Primary customers: Telco, Financials, Government– 100 countries– 33.4K employees (5 - 6K layoffs CY09)– 10 yr stock - $253.88 - $2.83, Currently $4.08

• FY08Q2 revenue loss $1.65B – Major corporate restructure announced

• Corporate vision - “The Network is the Computer©”– Everything and everybody connected to the network … however they want– Take pride in challenging mainstream IT

• Open source offerings, “Green” hardware, Edge/cloud computing

• Assignment: IT/Chief Technology Office– Leadership & IT strategy mentoring – Horizontal program manager – Evaluating new technologies/business practices/workplace environment

Sun MicrosystemsSun Microsystems

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• Strategy – Enterprise computing in the open network– Thin/cloud computing model provides cost savings and security– Software as a Service (SaaS) model for efficiency– Business Process Outsourcing where financially smart

• Execution - 15K new customers each year– Engaging academic/student market– Redefine IT business norms

• Information Management (IM), social networking, client options

• Organization – Intellectual Property focus on competitive advantage

• Subscription for rest• Never want to be a “custom” application• Enterprise Resource Planning (ERP), network, telephony

• Culture – We connect to work … we don't go to work• Completely mobile friendly environment• Corporate culture does not require extensive face-to-face

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• Culture of today's employees– E-mail is dead, IM and social networking critical– More productivity with employee chosen clients

• Mobility computing– Pushing applications to the edge– Wireless connectivity– Soft copy to increase pace with limited/dispersed manpower

• Non-Customized SaaS/Business Process Organization (BPO)• Allow DoD to break from constant patch-and-update spiral• Adaptation vs. custom solutions

Observed TrendsObserved Trends

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Northrop GrummanNorthrop Grumman

• Third largest U.S. defense contractor– Four business areas; five operating sectors– 2008 sales: $33.9 billion; $78 billion total backlog– 120K employees, 50 states, 25 countries– Balanced, Diversified: DoD 62%, Int’l 19%, Other USG 13%, FMS 4%– Leading capabilities in: Systems integration, C4ISR and battle

management, Information technology and networks, Defense electronics, Naval shipbuilding, Space and missile defense

• Northrop Grumman Electronic Systems (NGES)– 2008 sales: $7.1 billion; $16 billion total backlog– 20.7K employees, 22 major US locations, 27 International Locations– Develops, produces, integrates and supports: High performance sensors,

intelligence processing, navigation systems, power, power control, and ship controls for commercial and naval ships

• Assignment: Business Development and Strategic Planning Division

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Northrop Grumman Electronic SystemsNorthrop Grumman Electronic Systems

• Market Assessment (Northrop Grumman)– Defense/Intelligence top-line budget authority driven by threat environment

• Transition to force modernization / reset from war supplementals

• Pervasive need for information, electronics, and technical services

• Competencies match evolving national security priorities

• Programs well supported in FY09 budget and the FYDP

– National security trend - address the full threat spectrum • From traditional “force-on-force” defense to “securing the global commons”

• Non-DoD opportunities aligned with corporate capabilities growing faster than DoD

• Federal, State, and local governments; international

• Sector Strategy (Northrop Grumman Electronic Systems)– Superb products that provide mission solutions at an affordable price point

– Modular open system architectures supporting an adaptable product line• Readily tailorable to address a dynamic and diverse world market

– Continuous improvement of program and financial processes

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• Sector sets strong program performance and realistic growth objectives– Maintain/continuously improve program execution record (cost/schedule)

– Leverage customer relationships, technology leadership, international channels • Customer, product, value chain, geographical adjacency moves

– Identify opportunities for strategic relationships• Joint Ventures, teaming, licensing

– Practice active portfolio management for efficiencies• Mergers, acquisitions, divestitures, organizational restructuring

• Selective first-tier global defense company – Strengthening its Tier 2 position as a preferred supplier

– Assuming systems integrator, principal subcontractor, preferred supplier roles

– Leveraging transformation for discriminating technology and mission solutions

– Sound leadership and business processes


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• Corporate cross-sector integration key to customer focus, future growth – Strong management team, lessons learned mitigate some acquisition risk

– Acquisitions bring large-scale system integrator capability under one roof

– Internal organizational alignment a major challenge

• Organization focused on human capital – Recruitment, retention, leader development, incentives

• Always looking to improve– Effective mission assurance / continuous process improvement programs

• Enterprise Resource Planning (ERP), Lean, Six Sigma, GreeNG

• Improving cash flow, inventory management, cycle times

• Consolidating functions and facilities, reducing redundancy

• Leveraging tools to reduce costs, eliminate waste, improve efficiency


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• Sub-regional energy company – Largest subsidiary of Southern Company (#178 of Fortune 500)– Investor owned, tax paying utility serving 2.3 million customers– 2007 Operating revenues – $7.6B

• 34% commercial• 32% residential• 19% industrial• 11% wholesale• 4% other

– Consistent high rankings in customer satisfaction – key to rate justification

• Vision - To be the best customer service organization in the industry by influencing – both internally and externally – the profitable growth and success of Georgia Power and Southern Company

• Assignment – Distribution Organization – Assist development of talent acquisition strategy

• Improve recruitment of Veterans

Georgia PowerGeorgia Power

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• Strategic Goals– Continue the strong emphasis on safety! Target ZERO!– Lead the industry in service and customer satisfaction– Maintain strong relationships with external stakeholders

• Customers, regulators, local community leaders, elected officials, electric cooperatives– Continue to earn top quartile returns

• Long-term earnings per share growth rate of 5 percent– Grow earnings through profitable sales

• End-use, products and services, enhanced services, customer choice, other initiatives– Make “Southern Style” a reality– Continue to build employee trust

• Organization– Hybrid line-matrix organization

• Decentralized non-Metro Atlanta operations• Matrixed Metro Atlanta ops, personnel and some financial functions

– Highly paternalistic; generous personnel policies; loyal workforce

• Challenges– Meeting revenue targets in a challenging economic environment

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• World class safety program– Initiated “Target Zero” safety program in 2004– Steady decline in all categories since inception

• OSHA recordables, lost workdays, medical attention– Successfully implemented a significant culture change– Culture of safety permeates every aspect of operations

• Codified in the “Core Safety Beliefs”:• Safety takes precedence over all other requirements• Safety is a personal value• All hazards can be controlled• The “Spirit of Safety” is constant

• Talent acquisition– Talent acquisition centralized at the holding company level

• Recruiters do not have hiring authority– No clear and overarching process for identifying/satisfying talent requirements

• Internal customer dissatisfaction • Local, unsynchronized individual business unit solutions

– “It’s easier to do it myself”

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We pioneer flight solutions that bring people home everywhere…every time™

Sikorsky AircraftSikorsky Aircraft

• Continued Growth over past 3 years– 8,000 to 15,000 employees– Revenue increase from $2.6B to $7B– Margin Expansion: 10% in 2010; $10B in Revenue– Mergers and Acquisitions

• Significant backlog of aircraft orders• Stabilization in Execution – meeting commitments• Focused on regaining technological leadership

– Investment of Engineering & Development dollars– Creating “self-actualizing” platforms

• Globalization

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Assignment ActivitiesAssignment Activities

• CH-53K Program Management Team– $4B ACAT I-D Acquisition, Cost + Award Fee– Transitioning from Preliminary Design to Critical Design– Funding Profile Issues– Re-baseline and Restructure Potential– Award Fee Determination Period

• Sikorsky Aerospace Services– After market business segment– Transition to Condition Based Maintenance (CBM)– Development of Performance Based Logistics (PBL) solutions

• Operations– Supply chain management processes– Criticality of Enterprise Resource Planning System– Achieving predictable and stable build cycle

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• Genuine passion for rotorcraft and Sikorsky

• “Adapting” to the transformation– Helicopter Manufacturer in CT to Global Aerospace Firm– Influx of new senior management from outside the Company

• Criticality of Contracting methods – Award/payment criteria drive company actions– “What behavior is the government reinforcing?”

• Managing distributed development– Numerous “design houses”– 70% of CH-53K outsourced– Sub-Tier Supplier management– Technology “on-ramps and off ramps”

• Obsolescence before IOC

• Use of Enterprise Resource Planning (ERP) Systems – Linkage with Integrated Master Schedule

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RaytheonRaytheon

• Leading U.S. defense contractor– 72,000 employees world-wide– 2007 sales - $21.3B – Business units

Integrated Defense SystemsNetwork Centric SystemsIntelligence and Information SystemsSpace and Airborne SystemsMissile SystemsTechnical Services

• Corporate Strategy– Focus on key strategic pursuits– Leverage knowledge in core defense markets– Expand international business– Be a customer focused company

• Assignment: Network Centric Systems

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• Engineering dominated company – Focused on high tech solutions

• Continually working to improve internal and external perception

• Struggling to redefine from a product to services based company

• Strong process focus– Highly detailed with continuous improvement focus– Raytheon Six Sigma yielding success

• Attitude and personal commitment to continuous improvement• Strong buy-in at senior management and functional levels

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• Research, development & engineering firm– For-profit subsidiary of SRI International– Delivers vision, video and semiconductor technology

innovations that empower clients to see/sense, understand and control complex environments.

– 450 employees– > 40% with advanced degrees (Ph.D. and M.S.)– 2008 revenue $100M

• DoD trusted foundry• New focus on products• Assigned to VP for Video, Communications,

Sensing, Networking

SarnoffSarnoff

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Assignment ActivitiesAssignment Activities

• Planning and executing new venture: InSitech-MTAC– Nonprofit consortium for new Technology Center at Ft. Monmouth, NJ– Awarded $3.5M grant from State of New Jersey– Goal to grow $200M enterprise– Co-authoring bylaws, teaming agreements, proposals

• Working business development projects– Biometrics– Vital signs monitoring/Traumatic Brain Injury (TBI)– Chip scale atomic clock

• Video Argus – advanced video compression program

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• Bridging the research-to-fielded gap

• Difficulties in maintaining profitability in R&D– 75% Federal Government funding– Fixed price contracts are money losers– Venture capital disappearing

• Prime/subcontractor relationship does not work well for the sub


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Johnson & JohnsonJohnson & Johnson

• World’s Most Broadly Based Producer of Health Care Products– Revenues exceeding $61B annually…120,000+ employees worldwide– Operations in 57 countries; products sold in 200+ countries– Barron’s… “company most respected by investors”: #1 / 2006, #2 / 2007, #1 / 2008

• Three Major Market Segments– Consumer Products ($14.5B)– Pharmaceutical ($24.9B) – Medical Devices & Diagnostics ($21.7B)

• Key Priorities– Winning in health care– Capitalizing on convergence– Accelerating growth in emerging markets– Developing leadership and talent

• Assignment – Consumer Engineering, Technology and Innovation (ETI)

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Observations/RecommendationsObservations/Recommendations

• J&J Credo…deeply rooted corporate culture– Strategy, Vision, Moral Compass, & Statement of Heritage all in one! – Responsibilities to: #1 Patients, #2 Employees, #3 Community, #4

Shareholders– Credo-based Decisions: Tylenol Scare; Preservation of

Reputation/Brand

• Decentralization– Management responsibility placed at level closest to the customer– Truly a “family of companies”…drives decentralization’s

“entrepreneurial spirit”– Challenge to centralize where it makes sense (i.e…IT, HR functions)

• Recruitment & retaining employees is superb• Facilities, IT tools, flexible work schedules, benefits• Sense of transforming lives

secretary of defense corporate fellows final outbrief academic year 2008-2009

Documents

sdcfp sponsors

sdcfp background dod

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