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Lockheed’s Cost Saving

July 8, 2010
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One thing defense contractors do to try to win contracts is prove how light and efficient they are. They want to show that when it comes to overhead costs (costs that can't be charged to a specific customer, so either the company or shareholders usually eat the cost) that they can keep them low.
 
Well Lockheed's trying something pretty revolutionary in the corporate world; they're offering voluntary severence packages to thin their executive herd. Right after their CEO decided not to take the trip to an upcoming air show. I'm pretty impressed given we just flew a guy out to our site for a week, the sum cost for travel expenses and time here being 90% of my yearly salary. A few weeks ago we flew four intrepid executives off for a thrilling european tour where each person's airfare was about two times my raise this year.
 
We don't have the problem here at MegaCorp of Vice President of Douchebaggery, Director of Nice Corner Offices, General Manager of Passing Around Birthday Cards, Chief Window Curtain Color Officer, and Foreman of Office Cockroaches. However, I appreciate a good corporate cleaning as much as anyone. I hope this becomes a trend as to how defense contractors can save money rather than cutting back on R&D or on manufacturing domestically. Or to paraphrase the author in the blog I linked, I hope this isn't a gimmick to benefit shareholders only.
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