our customers and the highest degree of  transparency on all our programs. with the $487 billion already cut from the  budget, sequestration would result in almost  a trillion-dollar reduction in defense spending  over the next decade. Secretary Panetta has  said that cuts of that magnitude would have  catastrophic consequences to U.S. defense  and would severely erode America’s industrial  base. We agree. We must not let an automatic  budget trigger become the dominant force for  allocating resources and shaping the nation’s  security posture. We are strengthening the enterprise by  adhering to a strategy that puts a premium on  execution. Our relentless focus on execution  is a significant factor in reducing the cost of  doing business, and our remarkable record  of innovation continues to play a pivotal role  in keeping our portfolio relevant. Innovation  allows us to build on our core, move quickly  and smartly as new opportunities arise, and  meet affordability goals. As we look ahead, we recognize that we  are operating at a critical inflection point as  America and her allies confront an emerging  national and global security landscape. We  have devised a strategic blueprint based on  four imperatives: Secure, Extend, Expand,  and Enable. This strategy, which leverages the  strength of our portfolio, will pave the way  through what will be, at times, an uncertain  voyage. It will: We have no doubt we will continue to build on  that record, serving with distinction, remaining  true to our values, and helping to make the world  a safer, better place for the next 100 years. Over the course of a century, we have made  extraordinary contributions, working with  our customers, to meet our nation’s greatest  challenges: victory in war, prosperity in peace,  exploration of the universe, and effective  government services for our citizens. From  building some of the very first aircraft for the  U.S. military … to sending spacecraft across  the solar system … to meeting the diverse  needs of the U.S. Government and its allies  today, the men and women of Lockheed Martin  have always risen to the occasion with iconic  technical achievements. • Extend  the value of our platforms by  shaping follow-on business and tailoring our  existing capabilities for new applications. We  should also continue to seek and implement  innovative business models. •   Expand  our position within targeted  segments with market-based strategies. This  also means more pursuits internationally, and  greater synergies between Lockheed Martin  products. • Enable  meaningful growth through adjacent  market opportunities. We want to focus on  markets that will move the needle for us. • Secure  our existing programs by performing  with excellence. Additionally, we must  continue to have candid dialogues with  February 23, 2012 V 2011  Annual Report Christopher E. Kubasik President and Chief Operating Offi cer Ch i t h E K b ik Robert J. Stevens Chairman and Chief Executive Offi cer Chairman and Chief Ex