 If you thought of aircraft carrier, ocean liner, rowboat, destroyer, you're an incredibly well-educated adult. Give yourself an F. If you thought of submarine, give yourself a D. Apologies to the Navy personnel here for calling a submarine a ship. But I did not ask you to name things that float on water. I ask you to name different types of ships. If you thought of airship, give yourself a C. It has nothing to do with water. If you thought of spaceship, give yourself a B. And if you thought of friendship, ownership, or relationship, something like that, give yourself an A. Now, one of the keys to breakthroughs is not adding boundaries that are not there. We do it every single day to ourselves. And it's one of the greatest limiters that we have. I don't care whether it's in the technical world or whether it's in the leadership world. Removing those boundaries is a key to seeing things differently. And so I want you, for the rest of the workshop even, and as you carry yourself forward in life, I want you to remember that. To look at things differently, to look in the background, to not assume a ship is something that floats on water. And as I go through today's talk, I want you to look for where things are different. And the takeaways from today's talk, I'd like for you to hold inside your head as you go through the rest of today's and tomorrow's talks. Because I believe that what I'm going to talk about is going to set the stage for many of the other elements that you're going to hear through the course of the next two days. And that's based on talking with a lot of the speakers last night and in the room this morning. So let's start this way. I have been eating up with airplanes since I was a little kid. My dad introduced me to airplanes. His job during World War II was to man a Quad 40 Bofors gun to shoot down pesky airplanes. But his gun mount was on the flight deck level, and he watched aircraft operations. And he imprinted a love of aviation and aircraft and flying on me as well as patriotism. Airplanes ate me up since I was a little kid. And you can see here from drawings that my mom saved that I wanted to design airplanes ever since I was a little kid. And I fortunately got to do that. I got to do it for the company that developed the world's first Mach 2 fighter. This is the first plans for this aircraft were drawn up when we had barely broken the sound barrier. And now you're talking about designing an airplane that went twice the speed of sound. And it even looks like it's doing Mach 1 just sitting on the ground. The world's highest, one of the highest flying aircraft made out there, and is still in service today, the U-2 spy plane. Every time it flew, its test flight, it was breaking world records, and was often reported as a UFO to airline captains because they would look up in the sky above them twice as high as they were flying and see a shape flying up there and had no idea what it was. And then the magnificent Blackbird. Airplane where the outer skin was heated up so much from the skin friction of the air flowing over it at Mach 3 that it was hotter than your oven could get at home. And force a new mindset in how materials and aerodynamics and aerotherbodynamics were handled. Not only that, but it was the world's first stealth aircraft. And all of that came from the mind of this man and his team, Kelly Johnson. But not only was he brilliant technically, he was also a visionary leader. He set up an organizational construct that lives to this very day. And that's what I want to talk to you about for just a few minutes. But I want to set the stage for where the skunkworks came from. So now you need to flash yourself back to 1942, 1943, and the clouds of war are over Europe. This is a photograph taken on a particular mission of a B-17s of the 8th Air Force over Europe. And the story I'll share with you about this came from a B-17 pilot that lived at the facility my dad did in the later years of his life. His name was Mr. Barney. And he was a B-17 pilot, as I said. On his 18th mission to Germany, he was shot down. And he related this story to me firsthand. And so his hand, while he's telling the story, went up onto the wheel of the B-17's control column. His fingers were up on the bailout bell. And he's describing to me what it was like feeling the cannon shells hit his airplane as the yellow-nosed ME109's raked his airplane as he fell out of formation. So he's holding the bailout bell for his crew to get out. The deal he had with his top turret gunner was that when he heard that the 250 calibers over his head stopped firing, he knew that everybody else was out and that top turret gunner was on his way out. They would be the last two out of the aircraft. Finally, as the airplane is falling out of formation and he's holding tight to the control column because the aircraft wants to go out of control because the controls are so badly damaged, he hears the top 50 cows stop firing. And so he heads for the hatch that's in the lower side of the fuselage. The airplane diverges wildly from its flight path because of the damaged controls. He's thrown around inside the aircraft, desperately trying to find his way to the hatch, finds his way to the hatch, jumps out of the airplane. The airplane is gyrating wildly around him and he falls clean, he falls from, he stays in a free fall for just a few seconds to get away from the aircraft, pulls his parachute and then hangs limp in it so that he would not be the subject of strafing runs by the German aircraft. But he looks up and he sees something that I've never read in a book. And he said, I saw, this is him talking, I saw columns of smoke coming up from the ground and marking the trail back to England and that was all the aircraft that had been shot down. That was the smoke columns coming up with the contrails coming overhead of all the aircraft headed towards Berlin. He escaped twice from a Luft-Stallag and hid out in a farmhouse until Patton rolled through. Now, I mean, to me, that story was incredibly powerful and I look at this photo and I think of some of the missions that had a thousand aircraft associated with it, most of that being bombers. Each bomber had 10 crewmen on board and if you lost in a thousand airplane raids, let's say 800 of those were bombers and 20% of those is shot down. 160 aircraft, that's 1600 men that went down on one mission. The level of sacrifice and you guys have studied this, I'm sure, is just beyond comprehension for today. And that is the environment that the United States Army Air Corps was dealing with when Allied intelligence spotted a new aircraft being tested, the ME-262. The scary thing about this aircraft to them was that it was about 20 or 25% faster than our fastest fighters, the P-51. The jets that we had going on at the time were no faster than those propeller-powered aircraft. And so the Army Air Corps sitting here going, okay, if we get an aircraft that flies that fast coming through our formation, as it turns out, the ME-262 would come through the air formation so quickly that the electric-powered turrets could not pull lead to shoot it down. The cannons in the nose of the ME-262, a three-second burst put out 90 pounds of lead that would literally rip the wing off of a B-17, sorry, B-50, B-17. And there were also aerial rockets that put out a swarm of rockets that filled the basket the size of a B-17. I mean, these were devastating, and you're talking about losses where the possibilities of crewmen making 25 missions was virtually zero. And now you had a new technology being introduced. A gentleman that I met at the Skunk Works was a tail gunner in a B-17. His squadron was stood down after 20 missions because his was the only aircraft left. And now you have a technology leap happening and you're on the wrong side of it. What do you do? Kelly Johnson was speaking to a lot of people in the Army Air Corps. He was a project engineer at the Lockheed Corporation at the time, and he goes, I can do that. I can give you a jet very quickly. The Army Air Corps was looking for a jet, and they said, can you do it in 180 days, six months? Can you give us a jet, a prototype? Followed very quickly by production. He said, I can do that. Kelly comes back to Hall-Hibbard that you see pictured here, who was the chief engineer of the Lockheed aircraft company. And Hall goes, that's really great, Kelly. I'm really glad you're gonna come back with a contract, but I want you to remember something. We're building aircraft here for a war effort. We have so much going on inside the plant right now that we're building aircraft outside. This is a photo of P-38s in an outside assembly area down in Burbank. We were building as many as 28 aircraft a day. During this time period, Lockheed was hiring as many as 3,500 people a month. I want you to think about the human resources challenge of hiring 3,500 people a month, okay? And how do you train them and get them into jobs? You can see they were building all types of aircraft, including B-17s under license from Boeing. And Hall's admonition to Kelly was, you cannot screw this up. You cannot impact war production. And Kelly said, I have an idea. I've had it for a while, and that is, I wanna get a small group of people together, and I wanna empower them, I wanna put them together. I want, in all disciplines, not just the engineers, but the buyers, the planners, the tooling people, the manufacturing people, and I wanna put them right next to the airplane. I don't want them disconnected from it at all. And Hall said, great Kelly, I'll tell you what. You can have a tent. And this is the only known photo that we have of the original Skunk Works tent in the background. Made out of canvas, the walls were made out of torn down engine crates from the right cyclone engines that were brought in for the B-17 that they were building. Okay, pretty rudimentary facilities. There was no machine shop available on site, so Kelly bought a local machine shop in the Burbank area and it became the Skunk Works machine shop, and those employees that were in the machine shop became Lockheed employees. So it is own dedicated machine and tooling shop. Now, the idea was to get this jet built, this prototype built, in 180 days. So let's look at what the tempo looks like for 180 days. This is where they started the design of the aircraft. Okay, you can see that date up there, 17 May. When we go to, now they have the design requirements from the customer, you guys? Just a few days later. So the design was started ahead of the actual set of requirements, but there was a lot of verbal requirements given to Kelly. They approved, on this particular date, 17 June, they approved the L140, which became the XP80 as a program. Shortly after, the contract letter was submitted for it. You can see here, let's go to the next one here. This was the contract was released here. Now, for those of you that may be in the, floating around the acquisition chain, I want you to think about how long it takes to buy a bolt nowadays, okay? To ride a spec for a bolt and get it. But this is where you saw partnership on the part of the guys in what became the Skunk Works and on the Army Air Force side, trying to make something happen. Here you have the assembly complete of the aircraft and here is first flight. It was 143 days, okay? From contract award. From design start, it was 237 days. About nine months, okay? Breathtaking performance out there. And not only that, but the performance continued. Here's first flight. So you see the first flight in the top left corner here. You can see by 12 months later, and by the way, the prototype or see the production airplane was two months behind the prototype airplane to allow some lessons learned to be garnered. Two months of lessons learned. So that means that we're doing the production airplane as tooling and stuff was being assembled for the prototype airplane itself. The prototype had not even flown. So this is just maximum amount of concurrency. But you can also see down there six months later, so excuse me, 12 months after first flight of the prototype to YP80s, the pre-production aircraft were deployed to Europe. That's actually, there were four deployed. This is two of them flying, I believe it's near Sicily. And six months after that, 83 aircraft had been delivered. And if you look very closely in this photo, you will see that it's the production line for the P80 is right next to the production line for the P38s, okay? It's put together in a place called the Cotton Shed. The thing that was amazing to me as I look through the records of the P80 production, it was kitted. So there were a lot of modern things we consider modern manufacturing techniques that were applied to this in order to speed up the process. As a matter of fact, for each sub-assembly process as I look through the process documents, there was a clock for how long it should take to do each of these assemblies, sub-assemblies that went onto the aircraft. And each of those built up in timed processes that led to the completion of the aircraft. Kelly, as a result of the lessons earned, there was a set of rules actually put together by one of his chief engineers for the experimental shop, as it was called at the time. From the lessons of the P80, Kelly assembled some lessons for the skunkworks itself. And I've highlighted a few on here as one knowledgeable, empowered leader. And I'll show you an example of that in just a moment. It was also never surprised the customer. It was one of these situations where Kelly believed that the only way that you could get the kind of speed that was absolutely necessary was to have open communication and trust so that everybody knew what was going on. And as it turns out, there were Army Air Corps people that were at the Lockheed facility helping make decisions about how you make things move forward and getting parts delivered on time, parts were delivered in the middle of the night, decisions were made in the middle of the night. Anything that could be done to move the progress forward. There was manager team. Kelly set very clear expectations for his team. Very clear expectations for his team and very clear expectations for the leaders on his team out there so that there was no mistaking what was necessary to happen. Know what you're going to provide. And as I was reading some of Kelly's notes one time, he said the objective is to get a good airplane built on time. Not the perfect airplane, a good airplane. That's one that meets requirements. And how often do you see people trying to unnecessarily exceed requirements that brings in extra complexities and introduces failures that result in setbacks? So this is a really interesting mentality. Establish trust with your customer. This was one of the paramount things that was embedded in me as a leader at the Skunk Works. The amount of open communication I had with my customers was absolutely unbelievable and I valued it. And I was told by many of my customers how much they valued. Exactly knowing what was going on without any filters. And the last was reward performance. And rewarding performance was not necessarily monetary. In the case of the XP80, Kelly said meet the schedule. You get to come out and watch it fly. And so on the very first flight of the XP80, you see the team lined up on the hillside to watch America's first, what's gonna be their production jet fighter fly for the first time. Regarding Kelly's rule number one, I'm gonna give you an example of that. So this is pages out of his archangel log, which became ultimately the A-12 oxcart and SR-71 Blackbird. And on these pages, I want you to see on the left-hand side, where he goes through and does the sizing and performance buildup for a Mach 3 aircraft. And if you note up there, I believe the date is 1956. There's no computers to do this with. There's a slide rule. There's no understanding of the aerothermodynamics or the stability and control or the performance of the engines or anything. And yet this guy is up there sizing an aircraft. And I will tell you, his pencil sizings came very close to what the final product was. He had no simulations at all to work with. He had a fundamental understanding of the physics that went on, not only that, but he understood what it took to make a program out there. So on the right-hand side, you will see a buildup of pages from the log where he does the program planning. You'll see a staffing chart inside of here, as well as how he built up costs when supplies would be delivered. Basic program plans. You'll see here unit cost for each bird to be delivered. And then as you get to the very end, one of those all important things for test pilot bonuses being included in the cost buildups, okay? This is a man that's understood every aspect of what it took to make a program run. And it allowed him to strike the balance between what was necessary technically and what was necessary programmatically in order to achieve success. This is what he expected from his leaders. He said, make sure that the mission is clear, create the environment that you're gonna have for your people out there. Assemble those with the proper mindset, build the proper team, get the right people into the right jobs. How often have you seen the wrong person in the wrong job? Not only that defend the enterprise, because when you go and do something differently, have your iron underwear on because everybody's gonna attack you and tell you number one, it can't be done. Number two, you shouldn't do it that way. Number three, that's not how it's done. And a myriad of other reasons why you shouldn't do that. It's not according to the rules, pick something. So have the iron underwear ready. And lastly, inspire your team. I will tell you that as I talked to the people that worked for Kelly directly, and I only got to meet him once, they had violent loyalty to the man. He did not demand loyalty. It was through his actions that they were loyal to him. And the products that they achieved as a result of what Kelly instilled in them to this day for me are inspiring. And I'll leave you with just one note. Because there's always gonna be those people out there that tell you why something can't be done. Oops, back up. Fortunately, you need to know when not to listen. Enjoy the workshop, listen to it in a very different way. Listen for key points that go with these elements here. Take them with you because I guarantee you it will change how you look at problems and it will change how you lead people. Thank you so much.