Category 4 Measurement, Analysis and Knowledge Management
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1 Category 4 Measurement, Analysis and Knowledge Management Randy O Neal Vice President, Production Operations MFC Cat 4 Measurement - 1 Key Messages Framework Strategy Enablers Continuous Improvement Key Themes Panel Discussion MFC Cat 4 Measurement - 2 Strategic Planning & Execution System Plan Prepare Company Strategic Plan >10-year Horizon Develop Long Range Plan 3-Year Horizon Plan & Allocate Resources Annual Award Execute Plan the Program Design the Product Capture the Business Annual Acquire the Material Months/Weeks/Days Fabricate the Product Award Support the Product Quality Facilities Finance Human Resources Contract Deliverables MFC Cat 4 Measurement - 3 1
2 Strategic Planning & Execution System MFC Cat 4 Measurement - 4 Enterprise Leadership Council 23 top-level Tier I metrics, 50 Tier II metrics, XX Tier III metrics, XXX Tier IV metrics MFC Cat 4 Measurement - 5 Metric Driven Results Metric Alignment Quarterly Tier 1: Work Process Fabricate the Product Capture the Business Plan the Program Tier 2: Work Process Multiple Measures Hours Per Unit All Products Executive Review of Defects Per Unit All Products Etc. Tiered Work Systems and Processes Tier 3: Work Process Measure Monthly Hours Per Unit Product X Defects Per Unit Product Y Etc. Team and Product Level Reviews Tier 4/5: PMT Team Measures Daily / Weekly Hours Assembly Line A Rejects Assembly Line B Etc. Bottom to Top Metric Alignment Roll-up to Balanced Scorecard MFC Cat 4 Measurement - 6 2
3 4-Blocker Format Any RED item requires Root Cause Analysis and requires an Action Plan for improvement MFC Cat 4 Measurement - 7 Strategy Enablers Customer Connectivity Employee Engagement Continuous Learning and Improvement Knowledge Continuity Business Resiliency MFC Cat 4 Measurement - 8 Customer Connectivity Listening and learning process Both formal and informal Face-to-face, written, electronic Customers actively engaged throughout the life cycle enhancing working relationships Customer representatives on-site MFC employees embedded with customers, even in combat environments Customers actively engaged in Integrated Product Teams Customer evaluations drive changes in methods and processes Business Rhythm Process The customer directly feeds all operational aspects MFC Cat 4 Measurement - 9 3
4 Employee Engagement Achieve agility and flexibility through the Culture Optimization Process Address input from LMVoice surveys directly Respond to shifting demographics, employee engagement, leadership capabilities and the work environment Culture Optimization Process MFC Culture is an active endeavor that encourages active participation at all levels of the enterprise MFC Cat 4 Measurement - 10 Continuous Learning and Improvement Deployed eight step Path to Excellence Improvement of end-to-end process efficiency Sharing of Lessons Learned across the Enterprise and Supply Chain New and evolving tools, using data analytics, to face new and unique challenges The Path to Excellence A culture of continuous improvement MFC Cat 4 Measurement - 11 Knowledge Continuity Identify knowledge gaps Locate and connect with experts Capture and archive knowledge Apply across the enterprise Systematic collection, management, exchange and sharing of knowledge MFC Cat 4 Measurement
5 Business Resiliency Protect People & Facility Initial Event Response Stakeholders Identify Critical Processes Establish Business Priorities Execute BC plans Crisis Management Coordinate Communication Resume normal Business Operations Business Disaster Recovery Disaster Recovery Protect Critical Data & Assets Deter Technical Interruptions Facilitate Timely Restoration Business Continuity Business Continuity Assess Impact & Risk to Key Programs and Suppliers Maintain Vital Operations Restore Business Processes Unified Approach to Business Resiliency Planning and Execution MFC Cat 4 Measurement - 13 Performance Improvement Continuous Improvement Best Practice Sharing Results Structured Patents On-Time Improvement per Deliveries Employee Activities Over 6,000 Events resulting in over $865 Million in Cost Reductions MFC Cat 4 Measurement - 14 Performance Improvement Continuous Improvement Best Practice Sharing Results Performance Supply Quality Management Chain System Collaboration Reliability Team Participation Sharing Improvements across Products, Sites, and Supply Chain MFC Cat 4 Measurement
6 Performance Improvement Continuous Improvement Best Practice Sharing Results Return First Day Test Away on Flight Human Case Success Capital Rate Continuing to Increase Productivity and Mission Success MFC Cat 4 Measurement - 16 Operational Results, Growth and Financial Performance year CAGRs ROI = 23% Cash = 16% EBIT = 14% Orders = 9% Sales = 8% Margin = 6% Better Growth and financial performance has flourished because of a focus on operational results MFC Cat 4 Measurement - 17 Key Themes Data management integrated with the strategy and work systems Tiered metrics aligned to achieve strategic objectives at all levels Share data, information, and knowledge to respond to the environment Engage human capital and form relationships for performance Consistent customer engagement drives the Business Rhythm Continuous organizational, learning and sharing MFC Cat 4 Measurement
7 PREDICTIVE PERFORMANCE INDICATORS MFC Cat 4 Measurement - 19 Enterprise Performance Index (EPI) Product 728 Site 749 Line of Business 798 Functional 706 Monitors Product, Process and Human Capital Performance MFC Cat 4 Measurement - 20 Discussion Panel Randy O Neal VP, Production Operations Brian Oney Analyst, Strategic Planning Steve Sessions Director, Quality Jeff Hall Director, Strategic Planning Gary McPherson VP, Human Resources MFC Cat 4 Measurement
8 Employee Performance 50% CAGR = 8% 25% Return on Human Capital Sales per Employee Index (%) Our employees know mistakes here can mean casualties in combat. There can be no mistakes. 28% Growth Over a 5-Year Period Sales per Employee Index (%) 0% Our return on human capital has a compound annual growth rate of 8%. 180 MFC CAGR: 5.4% Benchmark CAGR: 3.9% P MFC Comp 1 Comp 2 Comp 3 Sales per employee have grown 28% in 5 years and exceeds those of 3 key competitors. S&P 500 Capital Goods Mfg Index MFC Sales per employee over the past 11 years exceeds the national industry benchmark by 38%. Our engaged workforce is a productive workforce, and it leads the industry MFC Cat 4 Measurement - 22 Return on Human Capital MFC Cat 4 Measurement - 23 Metric Connectivity MFC Cat 4 Measurement
9 Quality System Reliability Sigma Level Better Sigma Level Delivered Quality Previous Baldrige Recipient Delivered Quality Delivered Quality (%) EEU MFC Cat 4 Measurement
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