Lockheed Martin has a very interesting history and this history has had an impact on where the company is today with respect to its existing ethics program.

After reading Chapter 2 of the textbook “Ethics at Work: Creating Virtue at an American Corporation by “Daniel Terris”, and write an essay that addresses the following:

Lockheed has an interesting history that seemed innocent enough up until around the 1950s. You'll note on p. 56 of Terris’ book that the company began to engage in some questionable sales strategies with other nations in an effort sell the F-104 Star fighter so as to recoup costs when their US sales strategy failed.

1. Describe some of the unorthodox strategies covered by Terris during this era that made Lockheed become "…a byword for the shady practices of American multi-national corporations, and a major impetus for new legislation...".

2. On the issue of overseas bribes, Terris asks the questions, "Who was hurt by the [overseas bribes to secure sales of aircraft]? The competitors, of course, but what was unethical about beating out the competition that was playing by the same rules?” (p.59). What do you think about a situation where underhanded and back door deals are the way the game is played if everybody is on the same playing field? That is to say, if everybody is playing by the same shady rules, is it unethical to compete? In your reading you will note that defense contractors continued to find themselves in hot water well into the 1970s as a result of overpricing and additional charges of bribery. In the late 70s Lockheed established its first code of ethics and later the major defense contractors came to the table to level the playing field with the Defense Industry Initiative (DII), by agreeing on a set of ethical principles. This was an important turning point as was bringing Norman Augustine on board.

3. Why was the DII so important to the eventual success of Lockheed Martin’s ethics program?

4. Discuss Norman Augustine's and Dilbert's contribution in helping Lockheed Martin turn the corner with its ethics program.