Teledyne Picks Donald Rice as President : Aerospace: The former Air Force secretary, who has a reputation for integrity, joins a company plagued by legal problems stemming from allegations of fraud.
Teledyne Corp. has named former Air Force Secretary Donald Rice, who gained a reputation for integrity in the Bush Adminstration, as president at a time when the company is burdened by wide-ranging allegations of defense fraud.
The Los Angeles-based conglomerate also named Chief Executive William P. Rutledge to succeed retiring Chairman George A. Roberts.
Rice, 53, has no management experience with manufacturing companies, but Teledyne officials praised him for “a proven record of outstanding leadership of large technology-based organizations.” Rice headed the RAND Corp., a Santa Monica think tank, for 17 years.
“Everybody knows who Don Rice is and it opens many, many doors, but you also get his 17 years at RAND and all the policy knowledge that he has,” said Otis (Spike) Booth, an aerospace recruiter at the executive-search firm Russell Reynolds. “You get his special insight into military policy as well as his connections.”
Although Rice’s qualifications in the policy and political arena are obvious, he will also be handed “complete responsibility for all operations” of Teledyne’s far-flung empire of small manufacturing companies, Rutledge said.
“Dr. Rice . . . will sustain our tradition of ethical behavior as the basis of Teledyne’s business activities,” he added.
Federal prosecutors have taken exception to Teledyne’s notion that its tradition is one of ethical behavior. Teledyne has twice pleaded guilty to federal felony charges and the Department of Justice has joined three federal civil whistle-blower suits against the company. Indeed, Rice’s appointment could send an important signal to the Pentagon that the company is serious about redressing concerns about its ethics. The Defense Logistics Agency is considering whether to seek a broad-based suspension or debarment of the company. The agency has already suspended Teledyne Relays, a Hawthorne-based unit involved in a guilty plea by the corporation last year.
Meanwhile, Roberts, 74, ends a 52-year career with Teledyne and a predecessor company acquired by Teledyne in 1966--the year he became Teledyne president. He succeeded Teledyne founder Henry Singleton as chairman in 1991.
By recruiting from the outside, Teledyne passed over Executive Vice President Hudson Drake, the company’s third-ranking official. Drake was deputy undersecretary of commerce during the Nixon Administration.
It remains unclear whether Rutledge and Rice will reverse Teledyne’s long-established practice of reticence toward the news media and Wall Street. Rutledge has never been interviewed by a journalist, according to a company spokesman, an unusual claim for a Fortune 500 chief executive.
But Rice gained a reputation as being among the more accessible officials in the Pentagon, which is not known for its close relations with the media.
