Fundamentals of Mission Excellence Communicating Understanding the Requirements

Fundamentals of Mission Excellence: Communicating & Understanding the Requirements Conference on Quality in the Space and Defense Industries (CQSDI), Cape Canaveral, Florida March 26, 2007 Sonya Sepahban 0 Sector Vice President & Chief Engineer Mission Excellence Northrop Grumman Space Technology Copyright 2001 -2007 Northrop Grumman Corporation

Northrop Grumman Corporation Undersea Sea Land Air Space Cyberspace Mission Systems Newport News Integrated Systems Ship Systems Information Technology Electronic Systems Space Technology Technical Services 125, 000 Employees • 25 Countries • 50 States • 2006 Sales $30. 1 B 1 Copyright 2001 -2007 Northrop Grumman Corporation

Northrop Grumman Space Technology § A leading producer of satellite, laser and electronic systems Redondo Beach § Both a prime contractor and a major subcontractor § Strategically positioned to leverage and capitalize on advanced technologies § 7950 employees § 2006 sales of $2. 9 billion* § Headquartered in Redondo Beach, California 2 Manhattan Beach * Without Radio Systems (transferred to Mission Systems sector) Copyright 2001 -2007 Northrop Grumman Corporation

What Is Mission Excellence? § Mission Assurance § Product Quality § Chief Engineer Mission Excellence § System Safety and -illities Excellence § Process Excellence Do It Right!. . . 3 Copyright 2001 -2007 Northrop Grumman Corporation

The Journey to Mission Excellence Com plexi ty Mission Excellence § Collaboration across the value stream to ensure mission success with stable, predictable processes and flawless execution Mission Assurance Product Assurance Quality Management 4 § End-to-end independent verification that all mission performance, safety and quality requirements are met § Assurance that the enterprise designs, tests and delivers the product to customer’s requirements § Inspection of manufacturing and production processes to ensure they build and test what is designed by engineering Copyright 2001 -2007 Northrop Grumman Corporation

Three Axes of Mission Excellence Program Axis • Process focus on people, methods and quality • Product focus on outputs and deliverables STSS JWST • Program focus on overall performance to meet customer and mission requirements AEHF NPOESS Process Axis Lasers Bus Tech Eng Prod Supply Spacecraft Dev Chain Electronics Comm Payloads Propulsion Antennas 5 Product Axis Copyright 2001 -2007 Northrop Grumman Corporation

NGST Subcontracts/Suppliers Overview Subcontracts § 206 open subcontracts § Valued at ~$4 B § Large subcontracts (>$100 M) are distributed over <10 programs Suppliers § 1300 suppliers in Approved Manufacturing Directory § 65% mechanical, 35% electrical parts December 2006 data 6 Copyright 2001 -2007 Northrop Grumman Corporation

NGST’s Source Management Procureme nt strategy People 7 Flowdown of Source customer selectio requirement n s Initial Ongoing requirements source verification managemen t Final product acceptan ce Copyright 2001 -2007 Northrop Grumman Corporation

NGST’s Source Management (Cont) Procureme nt strategy Flowdown of Source customer selectio requirement n s Initial Ongoing requirements source verification managemen t Final product acceptan ce People Processes 8 § On-site § Make-buy § Subcontrac § Initial § Audits ts Mission source analysis Contract § Reviews: Assurance Review inspection § Approved Manufacturi Requireme § Complianc ng § Preship source nts Readiness lists e Matrix Readiness Document § Process Review § Historical Review, § Receiving capability § Subcontrac Identificati Technical t Request inspection & on Readiness performan for Document Review, Proposal ce data for Failure § Assessme § Quality complex Review Clauses (in parts nts Board Purchase § Parts, § Facilities § Cost & Order for surveys Materials & Schedule parts) Processes Performanc Control e Indices Board § Surveillance Copyright 2001 -2007 Northrop Grumman Corporation § Inspections

NGST’s Source Management (cont) Procureme nt strategy Flowdown of Source customer selectio requirement n s Initial Ongoing requirements source verification managemen t Final product acceptan ce People Processes Enabling Resources Policies & Procedures Program Approved Parts List & Approved Manufacturi ng Directory 9 Online Automated Supplier Information System In-depth Supplier Capability Assessments Supplier Rating Program Copyright 2001 -2007 Northrop Grumman Corporation

Cross-Value-Stream Challenges Performance Visibility Government Customer Prime Contractor Major Subcontractor Lower-Tier Subcontractors Requirements Understanding The issue: There can be a significant impact to the overall program due to an issue at lower levels of visibility and understanding of requirements Collaboration and communication are essential! 10 Copyright 2001 -2007 Northrop Grumman Corporation

Lessons Learned on a Recent Program Contributing Factors § Fragile sensor supply base § R&D orientation § Loss of skilled personnel and process control § Dependence on sensor heritage § Heritage overstated § Original bids underpriced § Transfer of development responsibility § NGC assumed design maturity (hence no need for exhaustive design reviews) after taking over development responsibility from the Government § Subcontract management practices 11 Lessons Learned § Trust but verify supplier capabilities early (via deep assessments) and help solve their problems § Challenge claims, perform detailed technical design assessments and conduct executability reviews § Repeat last major gate review to ensure proper design maturity after transfer § Use sound existing practices and intervene strongly at first sign of trouble Copyright 2001 -2007 Northrop Grumman Corporation

Understanding Predictive “Trip Wires” Trip Wires by Supplier § Predictive metrics used with monthly subcontract scorecard to identify: § Healthy suppliers Trip Wires by Type § Early warning on problems for preemptive intervention by “strike teams” 12 Copyright 2001 -2007 Northrop Grumman Corporation

Cross-Value-Stream Collaboration § Collaborative use of Six Sigma and Lean tools to help reduce program risks § James Webb Space Telescope (JWST) – Five complementary Lean events at three suppliers’ sites § National Polar Orbiting Satellite System (NPOESS) – Lean event with customer and sensor supplier § Working with customer and industry teams to improve processes and insights § Joint initiatives with Space & Missile Command (SMC) to improve program performance § Joint Audit Planning Committee (JAPC) collaborative audits to assess suppliers’ quality systems relative to AS 9100 § Comprehensive, collaborative supplier audits led by the Missile Defense Agency (MDA) through the Stakeholders Initiative 13 Copyright 2001 -2007 Northrop Grumman Corporation

The Journey Is Everything § “Mission Excellence” is the ultimate goal § We’ll never be “done” – there’s always something more to improve around the next bend in the road § Collaboration across the value stream is essential if the space and defense industries are to meet the nation’s expectations § Trust and verify Let’s Do It Right Together! 14 Copyright 2001 -2007 Northrop Grumman Corporation

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Topics for Discussion § Requirements § Government Specs & Standards § Flowdown to subcontractors and suppliers § Parts, Materials & Processes § Counterfeit parts § Lead-free initiative § Prohibited material screening § Assessments § Make-buy decisions § Supplier rating/source selection § Predictive indicators of subcontractor/supplier issues § Perceptive measures of subcontractor/supplier performance § Value Stream § Collaboration across traditional borders (customer-contractor, prime-sub, cross-competitor) § Management of lower-tier subcontractors and suppliers Sound familiar? Attend the breakout Tuesday morning for further conversation… 16 Copyright 2001 -2007 Northrop Grumman Corporation

17 Copyright 2001 -2007 Northrop Grumman Corporation