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LOCKHEED MARTIN IMPLEMENTS SPACE PANEL RECOMMENDATIONS

BETHESDA, MD, September 8th, 1999 -- Lockheed Martin is implementing recommendations of an independent panel commissioned in May to assess program management, engineering and manufacturing processes, and quality control procedures within its Space & Strategic Missiles Sector. The panel was asked to provide its recommendations to Lockheed Martin by September 1 and met that deadline by briefing the corporation's senior management August 30. The panel's executive summary is available on the Internet at Lockheed Martin's home page, www.lockheedmartin.com. The Independent Assessment Team on Mission Success recommended that Lockheed Martin develop a fly out plan for Titan IV's remaining missions, improve quality control processes and better manage its suppliers and subcontractors.

Additionally, the review team called for Lockheed Martin to strengthen functional and program management accountability for critical processes, improve senior management oversight and strengthen the accountability of engineers for the hardware and software in their areas of responsibility.

Other panel recommendations included enhanced training, mentoring, succession planning and the utilization of skills of qualified retirees to support critical events. The team also advised Lockheed Martin to formulate and communicate a policy on proper implementation of the better-faster-cheaper concept.

"To sum up months of work, we found problems in accountability, quality, subcontract/supplier management and cost emphasis," said A. Thomas Young, the former president and chief operating officer of Martin Marietta Corp., who chaired the panel. "We also found enormous fundamental technical strengths throughout the Space & Strategic Missiles Sector in that the people are highly capable and dedicated and the new leadership team is off to a positive start."

Gen. Thomas S. Moorman, Jr., vice chairman of the review team, vice president at Booz-Allen & Hamilton and former U.S. Air Force vice chief of staff, said that this is a "one strike and you're out business. Therefore, Lockheed Martin needs to demonstrate to its Department of Defense customers that it is putting in place rigorous quality control procedures, especially for Titan IV, perhaps equivalent to those that apply to human space flight." Moorman went on to say, "A well thought out fly out plan for Titan IV is absolutely crucial because of the national security implications of the payloads it carries."

Vance D. Coffman, chairman and chief executive officer for Lockheed Martin, endorsed the panel's findings and pledged Lockheed Martin to implementing its recommendations.

"The panel did a thorough, expert job and their report reminds us that nothing is more important than focusing on the customer," Coffman said. "We're strongly committed to acting on these recommendations because they will help us deliver the 100 percent Mission Success performance that our customers expect. Mission Success is Lockheed Martin's core purpose. It means getting it right the first time, every time, to fully satisfy our customers."

While applying the panel's recommendations throughout the Space & Strategic Missiles Sector, Lockheed Martin will focus particularly on the Titan IV program, which has 11 remaining launches scheduled.

"The payloads scheduled for launch on Titan IV missions have enormous national security implications and we fully understand the responsibility we have to our U.S. Government customers and the country to make sure those missions succeed," said Peter B. Teets, president and chief operating officer for Lockheed Martin.

"As a result of the panel's findings, we've already begun to make our oversight and quality control procedures more robust. We're also going to work with our customers and our suppliers to develop an integrated fly out plan for Titan IV to ensure that we focus intently on Mission Success through the completion of the program," Teets said.

Members of the Independent Assessment Team on Mission Success:

*A. Thomas Young, Chair, former President and Chief Operating Officer, Martin Marietta Corporation
*Thomas S. Moorman, Jr., Vice Chair, Vice President, Booz·Allen & Hamilton, and former Vice Chief of Staff, U.S. Air Force
*William F. Ballhaus, Jr., Vice President Science & Engineering, Lockheed Martin Corporation
*Thomas Betterton, former Assistant Commander for Space Technology, Space and Naval Warfare Systems Command
*Donald L. Cromer, former President, Hughes Space & Communications
*Richard M. Davis, former President, Martin Marietta Manned Space Systems
*Jimmie Hill, former Deputy Director, NRO, and Deputy Assistant Secretary of the Air Force
*Frederick H. Hudoff, former Vice President and General Manager, Space Launch Systems, Martin Marietta Corporation
*Ralph H. Jacobson, former President, Draper Laboratories and Director of Secretary of the Air Force Special Projects
*James W. McAnally, former President, Lockheed Martin Astronautics
*Kenneth V. Meyer, General Manager, Business Practices and Processes, General Electric Aircraft Engines
*Malcolm R. O'Neill, Vice President, Operations & Best Practices, Space & Strategic Missiles Sector
*Ronald F. Paulson, Vice President, Programs & Technology, Space & Strategic Missiles Sector
*Brent Scowcroft, former Assistant to the President for National Security Affairs
*Arthur L. Welch, former Vice President of Product Assurance, Martin Marietta Corporation
*Chester L. Whitehair, former Vice President, Space Launch Operations, The Aerospace Corporation

Meghan Mariman (301) 897-6195



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