Customer Success Is Our Mission Raytheon Six Sigma

Customer Success Is Our Mission Raytheon Six Sigma The Boldness to Imagine the Future The Passion to Deliver It. COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004

Focused on Customer Value LSL Customer Success Is Our Mission USL Historical Six Sigma Defect Reduction Value Stream Customer Value Contemporary Six Sigma Customer Success Is Our Mission COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004

Embraces All Tools Customer Success Is Our Mission Six Sigma • • • 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 COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004

Raytheon Six Sigma Customer Success Is Our Mission Integrated Business Strategy Customer Tools Culture Definition Our Knowledge Based Process for Transforming Our Culture to Maximize Customer Value and Grow Our Business Principles Process Visualize 1. Specify value in the eyes of the customer 2. Identify value stream and eliminate waste/variation Achieve TM Commit 3. Make value flow at pull of the customer 4. Involve and empower employees 5. Continuously improve knowledge in pursuit of perfection Prioritize Improve COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004 Characterize

Key R 6 s Roles Customer Success Is Our Mission • Champion: Senior leader who is a primary catalyst for planning and executing R 6 s deployment within the organization • Master Expert: Full time, experienced R 6 s leader who integrates R 6 s 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 R 6 s activity Spe • Specialist: Individual trained in basic concepts and productivity skills to area cial R 6 s ists improvement ts transform their work per Ex Champions COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004

Journey of Strategic Alignment Customer Success Is Our Mission 2000 - 2002 2003 - Beyond Fix Value Streams Survive Efficient Value Streams Improve New Value Streams Grow Germination Institutionalization Optimization Early Successes Build Capability Emerging Results Proven Grow Capability Significant Results Unconscious Leverage Capability Integrated Results 1999 - 2000. . What’s Next ? COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004

R 6 s: Cumulative Achievement 1200 $M/Year Customer Success Is Our Mission Gross Benefit $3 Billion 0 $M/Year 250 Net Benefit $776 Million 0 $M/Year 300 Operating Cash Flow $1. 2 Billion 0 People 1200 Germination Institutionalization Optimization Experts 1% of Population Specialists 42% of Population 0 25000 People 0 1999 2000 2001 2002 COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004 2003

Our Future Customer Success Is Our Mission Growth • Customer Focused Marketing • Mission Systems Integrator Y= f (X’s) R 6 s Impact Program Performance • Critical Chain • Design for Six Sigma • Predictable Process Profit & Cash • Productivity • Inventories • Billing Processes 1999 2000 2001 2002 2003 2004 2005 COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004 2006

R 6 s for Growth Customer Success Is Our Mission Efficiency Innovation Internal View – Improve the Current • Current Contract External View – Create the Future • Market Space • • Current Customer Focus Value Added – Non Value Added • Elimination of Waste Process Focused • • Earlier Involvement Bridging White Space • • Transition to Production Value Stream Analysis • • • Customers Offerings How Customers Obtain Value • Influence on Acquisition Process Where Do We Make the Product and Service Core Competencies Value Chain Analysis COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004

Customer Success Is Our Mission Raytheon Six Sigma Jon W. Mc. Kenzie jwmckenzie@raytheon. com 781 -522 -3368 COPYRIGHT © 1999 -2004 RAYTHEON. ALL RIGHTS RESERVED. 4/2004