Thread regarding Lockheed Martin Corp. layoffs

ISGS getting the shaft under the guise of "staying competitive..."

Hello again, well this weeks saga of Lockheed Martin has ISGS employees getting screwed. Why? Oh wait the same thing I said before, "because the rent is just too damn high" and we've got to keep those profit margins. Sondra Barbour EVP of ISGS announced that besides laying off over 500+ employees that she's also going to change all of ISGS's benefits to off "LM Essentials." Now most ISGS had the lovely corporate benefits now they're going to really get the shaft... this benefit package sucks six-ways-to-Sunday. "We made these difficult decisions as part of our efforts to remain competitive in an extremely challenging environment where industry dynamics have shifted, customer budgets are constrained and competition has continued to escalate continuing to reduce our overhead costs, is expected to enable us to be a much leaner and more agile organization which is what is needed to compete effectively." - Sondra Barbour

Now little serfs this is your pathetic package, don't touch mine... almost guarantee you that she isn't going on LM Essentials... nope she continues to enjoy those lovely EVP benefits.

Now Corporate denies this reduction in Staffing is related to the strategic realignment, but lets be clear here it is all tied together. ISGS will be forced to do this to get a potential buyer for the 17000 employees and service contracts that will be forced out of LM. Do you think for one moment that Hewson is going to spin up a company (because it costs money to spin up a new company and they just bought a 9-billion Sikorsky Air business.)

My best is MFC-services and ISGS will be sold off in chunks. For we the employees in this situation prepare for the wild ride... oh yeah and just before Christmas... unless you are one of Sondra's 500 that she's getting rid of and then you get the axe during November.

Instead the lovely EBS and Corporate organizations that don't really produce anything (i.e. Make money) will now have four business units to push their flow-downs upon.

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A union of defense workers will protect workers by having their own negotiation team

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The problems that LM IS&GS is now facing was a long time coming. Most smart folks in the inside knew that this will happen but they let the party run for as long as it could. The way LM IS&GS business ran and made money was unsustainable in light of a shrinking and hyper competitive market with less and less large size contracts to go around. Additionally, LM needs to figure out of it is an IT company or a company that builds hardware platforms for defense and non-defense markets. It is very difficult to be both and be really good at it at the same time. LM IS&GS has to compete against smaller, agile, and more specialized companies, and the large integrator model that it banked on for all this time is no longer that attractive to the new price conscious customers and government.. Employees at LM have always been shafted by the higher brass to keep their jobs and bonuses, and this will continue. Employee morale and length of service is not valued in this company as it was in the older days.

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"as a current employee in Gaithersburg it is incredibly depressing to work there. LM used to be a quality company that gave me a sense of pride. Now? More like an embarrassment. I cannot wait to get out of there. How does Barbour keep her job? Maybe it is best we don't know....... "

So true!

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They need to get rid of Emily Simone from the Community Relations Department.

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which benefits will be cut next? Don't you love how they slow roll this stuff out?

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Oh yeah and when all this reorganizating is done she won't be head of ISGS anymore 'coz there won't be no ISGS.

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She must have had pictures of people up in Valley Forge and now she must have cell phone video of folks in Bethesda.

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as a current employee in Gaithersburg it is incredibly depressing to work there. LM used to be a quality company that gave me a sense of pride. Now? More like an embarrassment. I cannot wait to get out of there. How does Barbour keep her job? Maybe it is best we don't know.......

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If it is any consolation, all the other big development houses are facing the same challenges. Services contracts used to provide a solid income stream, even if they did come with lower margins. Besides, we used to make it up in volume. Well now the margins are sinking and the volume is PLUMMETING. Smaller companies capable of operating under these conditions will step in to fill the void. In a few years, many of them will come up short and perhaps the government will begin to realize the limitations of "Lowest Price Technically Acceptable" (LPTA) contract awards.

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Princess, I think you are underestimating the challenges that Management is facing.... Our Government customers used to award on a "best value" paradigm in which they were often willing to pay a little more for superior products and services. IS&GS prospered in that environment and was able to provide its employees with better than average pay/benefits as a means of retaining a superior workforce. After decades of Government waste and mismanagement that buried the country in $18 trillion of debt, that best value paradigm has changed, and nearly all contracts (especially services contracts) are now awarded to technically adequate, lowest price offers. In an effort to be competitive in this cost shootout environment, IS&GS has had to bid 3-5% profit margins and hope that we win enough (and perform well enough when we win) to remain viable. As we continue to lose bids based on price, our direct labor hours decrease which, in turn, increases our overhead rates. We're in a graveyard spiral that we can't get out of. So Management now faces limited choices: 1) continue the same course and watch our sales and profit margins continue to decline as other companies undercut our prices, 2) further reduce employee pay/benefits and overhead to the bare bones and live with 3% margins in hopes of competing with the hundreds of other companies who are also trying to survive, or 3) get out of the "services" business and focus on the other LM core businesses that traditionally have higher profit margins. Management is responsible for maximizing shareholder value, not ensuring that employees have the best pay and benefits. That's the reality of the situation, and it's likely to be ugly for the employees. Unfortunately, this is probably the new normal.

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I meant to say that "LM has reported record high earnings for (at least) the past 12 quarters." And the last sentence should read "I think the above is applicable to any/every large corporation in the United States"

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As a LM employee I have become cynical and accept the current climate within the company. LM has reported record high earnings for (at least) the last 6 quarters. This is no secret. We (employees) receive corporate emails indicating the quarterly earnings. This information is available to the public, so I am not divulging company proprietary information.

So, the bottom line is this. Employees and property (assets) are expendable. Upper management is ALWASY viewing the company as a whole; every building, considering every project, number of employees involved in those projects etc. Based on those continued assessments, business decisions are made as to how to become more lean and competitive == what buildings (costly assets) and employees (costly assets) can we eliminate to improve our bottom line. Because, that is what it comes down to. The bottom line can be improved by improved (higher) sales and/or by lowering overhead (reducing costly assets).

So, each week I continue to work conscientiously (because that is my good work ethic) knowing that at the end of the week, when I receive my paycheck, Lockheed and I are even.

I don't think the above is applicable to any/every large corporation in the United States (can't speak for other countries).

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