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Case “The Last Supper” by Kent Kresa

Case “The Last Supper” by Kent Kresa. What is a CEO’s job?. Maximize shareholder value. What Drives Strategic Actions. Environment Specific Options Available Perceptions of Future Market Place. Early 1990’s – Defense Environment. End of Cold War Peace Dividend Last Supper

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Case “The Last Supper” by Kent Kresa

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  1. Case“The Last Supper”by Kent Kresa

  2. What is a CEO’s job? • Maximize shareholder value

  3. What Drives Strategic Actions Environment Specific Options Available Perceptions of Future Market Place

  4. Early 1990’s – Defense Environment • End of Cold War • Peace Dividend • Last Supper • DoD procurement budget decline • New weapons technology emphasis • Wall Street pressure on defense firms The World Had Changed

  5. Strategic Options – Early 1990’s • Shrink in place • Sell off programs and businesses • Merge with another military aircraft manufacturer • Make strategic acquisitions to reposition company in defense growth areas (adding more value over the parts; add market shares, look at industry future; go after other market segments)

  6. Northrop Grumman Merger & Acquisition History 1994 • Grumman Corporation(Integrated Systems) • Vought Aircraft(Aerostructures) 1996 • Westinghouse Electronic Systems Group(Electronics) 1997 • Allied–sold (Truck Bodies) • Logicon (Information Technology) 1998 • INRI (Information Technology) 1999 • California Microwave(Electronics) • Data Procurement Corporation(InformationTechnology) • Ryan Aeronautical (Integrated Unmanned Systems) 2000 • Comptek Research (Information Technology) • Sterling (Information Technology) • Federal Data (Information Technology) • Navia(Electronics) • Aerostructures – sold 2001 • Litton Industries (Electronics, Information Technology, Ships) • Newport News Shipbuilding (Ships) • EIS of Aerojet (Electronics) 2002 • TRW (Satellites, Electronics, Information Technology)

  7. Ideally Aligned for Future Defense Needs… Core Competencies 21st Century Defense Needs Programs • Large-Scale Integrated Systems • Design and Manufacture of Sophisticated Electronic Sensor Systems • Naval Shipbuilding & Propulsion Systems • Air Vehicle Design / Systems Integration • Stealth Technology • Information Operations • Navigation & Guidance Systems • Space Systems • Lasers GLOBAL FORCE PROJECTION / PRECISION STRIKE SURVEILLANCE TARGETING SURVIVABILITY INFORMATION WARFARE MISSILE DEFENSE Aircraft Carriers, Attack Subs, B-2, F/A-18, F-35, Destroyers, Amphibious Assault Ships, ICBM Satellites, JSTARS, E-2C, Guardrail, AWACS, Hunter, Global Hawk F-22, F-35, F-16, Longbow, B-1B, Air Defense Radars, LITENING Electronic Warfare Aircraft, Radar and IR Jamming Systems Intelligence, Infrastructure Protection, Information Assurance, Advanced EHF, Milstar, Deepwater STSS, SBIRS High, Integrated ISR, Battle Management, Laser Weapons HOMELAND SECURITY

  8. commercial • Hush hush • Resources • Mentality • Customers • Scientists not entrepreneurs • Advertising • Costs

  9. Top 3 Lessons • Ethics: honest, open • Good communication: communicate your vision, technical issues, problems • Vision: be prepared to take a position and follow through; have the courage to change

  10. Any issues with Aerospace?

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