Lockheed Objects to FixedPriced Deals


W

Wayne Keen

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From Here:
http://www.military.com/features/0,15240,133533,00.html?ESRC=dod-bz.nl

WASHINGTON - A Lockheed Martin executive on Tuesday bristled at the Navy's growing interest in fixed-price contracts for new military programs, saying the money-saving strategy could backfire by reducing the quality of the work performed.

"We do not think that fixed price contracts are appropriate for development activities because they do not encourage the type of direct, responsive, collaborative behavior necessary for success," said Chris Kubasik, vice president of investor relations, in a conference call with Wall Street analysts following its first-quarter earnings report.

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Dec 2, 2000
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Easley South Carolina
The Lockheed executive may have a point. The interest in controlling costs is both understandable and laudable, but when R&D is going on the cutting edge of technology, fixed price contracts can leave out any wiggle room for the unexpected problems that always come up.

No bucks, no Buck Rogers.
 

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