With more than 30 years of experience in the aerospace industry, Roger Krone now serves as president of Network and Space Systems for Boeing, and leads 19,000 employees in 45 states and in nine countries.
ExecutiveBiz talked to Krone to get his perspective on what company growth means for the billion-dollar firm, the space industry and what important characteristics to consider when assembling a team.
ExecutiveBiz: Talking to industry analysts these days, it seems like organic growth is something of a challenge, especially for larger firms in the government-contracting market. How is Boeing approaching that challenge?
Roger Krone: Organic growth is growing internally. This is where we find new business, RFPs, commercial business opportunities, and we use the talents and skills that we have today or that we can develop today to win new business. We go where our customer goes, and we’re all about aligning with our customers and their missions. We try to be ahead of the customer so that we understand where the world is going on a very macro level, what the missions of our customers are and, therefore, what kind of equipment, products and services they need.
I think we’re going to see fewer multibillion-dollar, new-start, platform-development programs — big programs of record. I think we will sustain a lot of those bigger programs, but we are going to see more small programs focused on C4ISR and intelligence. What’s inside the platform is going to be as important as what the platform is. At Boeing, we’re spending more of our time developing the content and systems that go inside the platforms to enhance current platforms, to extend their service life and to extend their applicability in supporting the government customer. This is versus what we spend developing a lot of new, big, multibillion-dollar, decade-long platform development programs. In my area especially, which is the Network and Space Systems part of Boeing, that really fits into our sweet spot. We see this model in the four domains in which our platforms operate — in space, air, land and sea.
ExecutiveBiz: Speaking of the space business, it seems like the government’s approach to how it wants to interact with contractors moving forward in the space market is changing. What’s your take on that?
Roger Krone: I think we’re very much aligned. We think the space market is maturing in several different ways. In the ‘50s and ‘60s, we saw a high-growth market and a lot of high-cost investments — going to the moon, filling out Milstar constellations, putting commercial satellites in space, including Syncom, which was our early communication satellite. We then got to the point where we’re filling up the geo-belt, followed by a period of continued government investment — the post-moon era, the shuttle era. A lot of “hype” in the space market followed.
Where are we now? I’d say we have a relatively thoughtful, mature market. The geo-belt is full. We’ve got a couple of LEO [low-earth orbit] constellations in the communications market. We have a completed GPS constellation, which in its own way signifies a maturing market. Government looks at what they’re buying and sees that there are good commercial alternatives for some of the services they buy. With that maturation, you see a lot of new entrants. Boeing is actively involved in what we call Commercial Crew Development II. We just got a $92 million contract to advance our CST-100 vehicle, which would provide commercial human transportation service to LEO, to places like the International Space Station and the Bigelow Space Station, and any other place that people may want to go.
In short, it’s an exciting time in which taking risk and being innovative will be rewarded. We all know the government’s debt and budget challenges and the impact on priorities. The priority, back in the ‘60s was going to the moon. Today, space is a priority, not the priority, and therefore has to compete on a value basis with everything else in the federal budget.
ExecutiveBiz: As a leader, what sort of characteristics are most important when you decide how to best assemble a team?
Roger Krone: Leading in today’s market is very different than a decade ago or 30 years ago when I started out. Thirty years ago, a cost-plus environment meant performance essentially at any price. Today, we have a much more balanced view of the entire value stream of innovation. Now is a time in which leaders need to lead and innovate, try new things and step out. To do that, my personal view is that a leader leads by articulating a strategy and a vision, and then leading by example.
What I try to do is build a structure to support where we want to go as a business — organize and assign the roles and responsibilities of the team. Finally — and most importantly — we’re all really in the people business. Finding outstanding people to be on the team is critical, as is putting the right people in the right place. Any success I’ve had in my career has been due to outstanding people. I look for folks who really know how to innovate and who can look at chaos and create a vision. Those are the people who possess the courage and persistence to drive something to closure. I also look for people who like to win, who have ambition and know where they want to go. I have faith in and trust my team.
The final thing that I want to stress, and I can’t stress this enough, is the concept of personal integrity. At Boeing, we really value personal integrity and intellectual honesty. The one thing that has been unique for me in the different companies that I’ve worked for is how valuable the Boeing name is. It’s in some ways one of those iconic brands in the United States. It is revered worldwide because of what we do every day across the company. We’ve got about 12,000 commercial Boeing airplanes flying every day. Millions of people cross the threshold of a Boeing aircraft because they view what we do with the highest of integrity. That is about what everyone at Boeing does every day – all 168,000 of us. Integrity is so fundamental to our culture and to what we do. It is clearly embodied in how we view leadership at the company.
ExecutiveBiz: That was all I had. Is there anything else that you wanted to add today?
Roger Krone: We used to innovate around the product, the technology, the design. Now we need to innovate across the entire value stream — from how we manage the supply base, the business aspects of the transaction, financing, how we share risks among the supply base.
Government is changing the way it’s buying, so we must be as flexible and agile as small companies. Otherwise, we might wake up one day to find out that the big five aerospace/ government defense contractors have become like the big automotive companies, because more agile competitors have taken over our markets. Remember, Honda started with a motor scooter and ended up as one of the top five car companies in the world. They started with a motor scooter. For us to look at the motor scooter companies in the government space and not take note would be a mistake.