Long groomed as the next chief executive officer (CEO) of Lockheed Martin, company Chief Operating Officer (COO) Chris Kubasik will begin sharing some of current CEO Bob Stevens’ responsibilities, marking what experts say is the beginning of a transition in leadership.
On Oct. 1, the two began sharing responsibility for daily operations through a new Corporate Executive Office established by Lockheed’s board.
“The standard playbook in a corporate succession is always to slowly ease in a successor, so that investors and customers do not notice any discontinuity,” Lexington Institute analyst Loren Thompson said. “If this really is the beginning of the succession, which I believe it really is, the next major milestone would be when Bob Stevens relinquishes one of his titles.”
Earlier this year, rumors circulated that Stevens was mulling retirement, but Lockheed spokesmen denied he had any plans to depart. With this announcement, the topic of retirement is again making waves.
“Bob continues to provide critical leadership and direction for Lockheed Martin and will remain the chairman and CEO,” Lockheed spokesman Chris Williams said. “When a decision about Bob’s retirement has been made, we will inform our employees, shareholders and customers.”
The new office will allow Kubasik to share more of the management of daily operations and to reach out beyond his current responsibilities in the corporate structure, Williams said.
“Chris will remain the president and COO of Lockheed Martin, but his responsibilities will increase,” he said. “As members of the Executive Office, Chris and Bob will act interchangeably to promptly address and resolve operational and functional matters as they arise. Chris also will increase his interaction with the executive and legislative branches of the U.S. government, and will re-engage with the major investors and key analysts with whom he worked … as chief financial officer.”
While the announcement of the new office was not immediately anticipated, the escalation of Kubasik was, said aerospace analyst Ron Epstein with Bank of America.
“People are expecting this; no surprise here at all,” Epstein said. “It’s just a transition period for Chris.”
Given Stevens’ iconic status in the defense industry and his seven years at the helm, any change at the top could affect perception of the company, Thompson said.
“Lockheed Martin as it exists today has been significantly shaped by Bob Stevens’ personality,” he said. “He brought it from the brink. Because Bob Stevens is a unique individual, any successor is going to bring a different approach to the company.”
While there may be a difference in styles, Kubasik is widely respected in the industry, and expectations would be high if he took over, Thompson said.
“Even in a company that is exceptionally gifted in terms of executive talent, Kubasik stands out,” he said.
In a press release about the new office, Stevens also praised Kubasik: “The expansion of Chris’ responsibilities demonstrates the confidence that the board and I have in his ability, vision and leadership skill.”