General dynamics Corp.
The May shareholders’ meeting became controversial when an anti-war activist confronted CEO Phebe Novakovic over the company’s arms sales to Saudi Arabia and other repressive governments. âYou should have a more moral reflection on how you make your billions of dollars,â the activist said.
After offering to sit down for a “policy conversation,” Ms. Novakovic calmly defended the company’s mission of supporting US policy, which is “just and equitable and in our best interests.” She added that everything General Dynamics makes, from nuclear submarines to armored vehicles, is designed to “deter evil – and there is evil in this world.”
âOur customers are better served if we are silent and do our jobs well. ”
Ms Novakovic, 63, who has headed General Dynamics since 2013, keeps a low profile. Because her Fortune 100 company has a primary client, the Department of Defense, she says she doesn’t see much benefit in âpublicly proselytizingâ about their products and services. âOur customers are better served if we are silent and do our jobs well. “
But in a rare Zoom interview from the company’s headquarters in Reston, Va., Ms. Novakovic is eager to reaffirm the core patriotism of her work. “It is our moral imperative to support our nation and to support our nation’s allies in the work they do to keep democracies safe,” she said. She adds that she may have personal concerns about a particular policy, and that the company is not “consulted on the end use” of the equipment it sells. But she argues that it is General Dynamics’ duty to help defend the freedoms we too often take for granted. “These are principles, not politics.”
Ms. Novakovic’s patriotism was forged during the Cold War. His father, a Serbian immigrant, served in military intelligence as a lieutenant colonel in the US Air Force and was primarily stationed in West Germany with his family. Living there while growing up was a form of training for her. The country was still relatively poor, recalls Ms. Novakovic, and “gratitude for what we did in WWII was still palpable.” She felt proud to know “that if anything happened, the US military would be there to help you.” She was also grateful to be a citizen of a country where a hard-working immigrant can grow: âThis nation has been and will continue to be made great through immigration. “
After graduating with a history degree from Smith College in 1979, Ms. Novakovic wanted to serve her country. She felt the military wasn’t the right fit – âI intuitively knew I wasn’t doing well with the rulesâ – so she joined the CIA. She gives few details about her years working for the agency, but says she âlovedâ the experience. âI felt like I was doing something important,â she says. “It was a calling.”
While at the CIA, Ms. Novakovic met her first husband, Michael Vickers, a former Green Beret, and they married in 1985. With the end of the Cold War, they both sought an MBA at the Wharton School at the University of Pennsylvania, graduating in 1988. Ms. Novakovic believed that a career in business would be best for raising a family, but finding work was difficult. She “desperately” wanted a job in the steel trade, eager to work in an industry in transition. But when she arrived for an interview visibly pregnant, she was told “We’re not hiring” within a minute. Other refusals followed. âYou learn to be resilient,â she says.
Ms. Novakovic finally got a job with the Federal Office of Management and Budget in 1992 and quickly rose to manage President Clinton’s budget for national security. Divorced and raising three young daughters, she remembers those years as a little blurry: âI would fall to bed exhausted, wake up exhausted, but keep going because I had no choice. She has a lot of empathy for working mothers, but when female executives ask for advice on finding balance, she is quick to say, âWell, you won’t find it. In 2001, she married David Morrison, a former Boeing lobbyist..
After working at the Pentagon for several years, Ms. Novakovic began
eyeing national security jobs in the private sector. Among the CEOs she had met, General Dynamics’ Nicholas Chabraja stood out for being both “superb” and a former litigator, which bodes well for someone with Ms. Novakovic. She joined the company in 2001.
Mr Chabraja, who led General Dynamics at a time of shrinking defense budgets, was Ms Novakovic’s mentor and appointed her senior vice president in 2005. But when he retired as CEO in 2009 his post went to Jay Johnson, a former naval chief. Operations. Ms. Novakovic managed the company’s marine systems, became president and chief operating officer, and later took on the role of CEO herself in 2013.
At the time, General Dynamics was losing money – an unprecedented $ 332 million in 2012. To right the ship, Ms. Novakovic took a $ 2 billion depreciation for 2012, blaming some ill-conceived acquisitions, and started fixing what she calls a “leadership team.” To improve morale and cohesion, she developed a corporate philosophy – “a word more powerful than ethical, which really means the fundamental moral character of an organization” – which values ââtransparency, honesty and trust. She also fired “everyone who couldn’t take it.”
This philosophy, she says, has helped General Dynamics weather the pandemic. When the federal government deemed the company’s manufacturing operations critical, Ms. Novakovic decided that if line workers and shipbuilders were to report for work, her management team would also report: âIn a crisis. , there is nowhere to hide weakness, âshe said. . New protocols, staggered shifts and protective gear have minimized the transmission of Covid-19 in the workplace; in October, the company reported that less than 2% of its 100,000 employees worldwide had been infected. General Dynamics has also advanced more than $ 2 billion to suppliers to limit the disruption. Ms. Novakovic decided to participate in this interview, she said, to publicly thank her employees “who kept watch”.
Ms. Novakovic concedes that the military-industrial complex exhibits inefficiencies but says the costs of deterring threats and protecting Americans are necessarily high.
The United States will spend more than $ 740 billion on defense in 2021, more than the next 10 countries combined. Ms. Novakovic concedes that the military-industrial complex exhibits inefficiencies but says the costs of deterring threats and protecting Americans are necessarily high. Submarines, for example, “secure our borders every day in ways you don’t even know about, because they can’t be found.” In 2019, General Dynamics secured a multi-year order of $ 22.2 billion for fast attack nuclear submarines, the largest contract ever awarded by the Navy. The smallest submarines manufactured by the company are the length of football fields.
Ms. Novakovic categorically refuses to answer questions about US policy and foreign policy: âI have no intention of compromising or embarrassing my client in any way. Despite apparently dramatic policy changes from administration to administration, she notes that “there is fundamental consistency in the importance of national security.” Company contracts tend to last longer than presidential terms.
But it clearly promotes American engagement with the world. “Great nations survive when they have a lot of allies, despite their difficulty, despite their unfair or unequal contribution,” she said. It is âprideâ, she adds, for a great international power to ignore what lies beyond its borders. “No nation is an island, successfully.”
Corrections and amplifications
Phebe Novakovic is 63 years old. An earlier version of this article incorrectly gave his age at 64. (Corrected June 25)
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