He would rise quickly through the ranks at TRW Inc., becoming at 35 the chief engineer for the development of the payload for the nation's first major military communications satellite system, known as Milstar. "They said I was too young to run it so they made me the chief engineer," Sugar recalled.
"I knew he was outstanding, so I knew he would move up the company rapidly," said Simon Ramo, co-founder of TRW and the father of the nation's ballistic-missile system.
Ramo, one of the last remaining so-called cowboys of aerospace, who retired from TRW in 1978, said "everybody wanted to hire Sugar."
A top post seemed only a matter of time, but Sugar, who had been at TRW for more than 20 years, was passed over as a possible successor to then-Chairman Joseph T. Gorman in 2000. He bolted for another company, Litton Industries in Woodland Hills.
The move would turn out to be timely. Northrop Grumman, on an acquisition spree, purchased Litton a year later in a deal that placed Sugar in line to be Northrop's CEO. Northrop then capped its spending spree by acquiring TRW.
In 2003, Sugar was named chairman and CEO of Northrop Grumman, succeeding Kent Kresa, who had rebuilt an aerospace company teetering toward bankruptcy. In the early 1990s, Pentagon contracts had dried up as the Cold War ended, leaving Northrop with one major program, the B-2.
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Defensive moves
Since taking the helm, Sugar has focused most of his attention on integrating the companies that had been acquired over the years and looking at expanding the company internally. Northrop, which generated $7 billion in annual revenue in 2000, could surpass $35 billion this year.
But Northrop and the defense industry are about to face some head winds as the Pentagon looks at cutting back on big-ticket weapon programs.
Sugar has said Northrop is in a better position than other defense companies because it isn't dependent on any one big Pentagon program. The company is involved in more than 20,000 programs, with no single contract accounting for more than 3% of annual revenue. Still, with the anticipated slowdown, Sugar has been urging Northrop managers to expand the company's engineering know-how to commercial and civil markets.
Sugar has taken some political hits for partnering with a European defense contractor to build a new generation of aerial refueling tankers for the U.S. Air Force and has been embarrassed by development problems in shipbuilding.
