COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Raytheon Six Sigma The Boldness to Imagine the Future The Passion to Deliver It.

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Focused on Customer Value Customer Success Is Our Mission Historical Six Sigma Value Stream Customer Value Defect Reduction LSLUSL Contemporary Six Sigma

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Six Sigma Quality Design of Experiments Process Capability Analysis Tool (PCAT) Gauge R&R Ishikawa Tools Process Mapping Statistical Process Control Design for Six Sigma Design To Cost Statistical Requirements Analysis FMECA Statistical Design Performance Simulation Software Predictive Statistical Tools Risk Management DFMA Quality Function Deployment Re-engineering Process Mapping Change Management Skills Process Improvement Teams Problem-Solving Tools Benchmarking Lean/Agile Manufacturing Value Stream Analysis Lean Enterprise Lean Manufacturing Agile Manufacturing Just In Time Supply Chain Management Kaizans Mistake Proofing Cycle Time Reduction Continuous Flow Manufacturing Goal Deployment Balanced Scorecard Six Sigma Embraces All Tools

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Raytheon Six Sigma Prioritize Characterize Improve Achieve Commit Visualize Customer Culture Tools Our Knowledge Based Process for Transforming Our Culture to Maximize Customer Value and Grow Our Business 1.Specify value in the eyes of the customer 2.Identify value stream and eliminate waste/variation 3.Make value flow at pull of the customer 4.Involve and empower employees 5.Continuously improve knowledge in pursuit of perfection Integrated Business StrategyDefinition Principles Process TM

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Key R6s  Roles Experts Champions Specialists Champion: Senior leader who is a primary catalyst for planning and executing R6s deployment within the organization Master Expert: Full time, experienced R6s leader who integrates R6s into the business. Is a strategic Business Partner focused on value to our customers. Expert: Full-time individual trained to lead complex projects and train/mentor others in R6s activity Specialist: Individual trained in basic R6s concepts and productivity improvement skills to transform their work area

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Journey of Strategic Alignment Fix Value Streams Survive Germination Early Successes Build Capability Emerging Results Efficient Value Streams Improve Institutionalization Proven Grow Capability Significant Results New Value Streams Grow Optimization Unconscious Leverage Capability Integrated Results Beyond What’ s Next ?

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission R6s: Cumulative Achievement Gross Benefit Net Benefit Operating Cash Flow Experts Specialists 1% of Population 42% of Population $1.2 Billion $M/Year People GerminationInstitutionalizationOptimization $M/Year $776 Million $3 Billion 2003

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Our Future R6s Impact Profit & Cash Productivity Inventories Billing Processes Program Performance Critical Chain Design for Six Sigma Predictable Process Growth Customer Focused Marketing Mission Systems Integrator Y = f (X’s)

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission R6s for Growth Efficiency Internal View – Improve the Current Current Contract Current Customer Focus Value Added – Non Value Added Elimination of Waste Process Focused Earlier Involvement Bridging White Space Transition to Production Innovation External View – Create the Future Market Space Customers Offerings How Customers Obtain Value Influence on Acquisition Process Where Do We Make the Product and Service Core Competencies Value Stream Analysis Value Chain Analysis

COPYRIGHT © RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Customer Success Is Our Mission Raytheon Six Sigma Jon W. McKenzie