LOGISTICS SUPPORT

1. Lean+/ Systems Engineering LOGISTICS SUPPORT Modina Williams Process Reengineering Team Lead Sustainment Data Systems, Systems Support Presented to the Midwest Gateway Chapter of the International Council on Systems Engineering (INCOSE) July General Meeting July 26, 2006

2. Overview • Introduction • What is Lean/ +? • Lean Enterprise • Lean Methodologies/ Tools • Examples • Lean /+ System Engineering • Spirit of Lean

3. Certified Lean Integrator/ AIW Facilitator Process Reengineering Team Lead Common Process Initiatives AIW’s/ Sensing Sessions/ 3P/ LMA’s /Value Stream Mapping Sustainment Data Systems/Support Systems BS In Industrial Engineering 6 Sigma Training Continuous Improvement MS in Project Management Sept 30, 2005 Dion Nehemiah Shop Load IE

4. What is …..? Lean:The relentless, systematic elimination of waste to create sustained competitive advantage. Lean+:The one overarching continuous improvement approach Overarching Principles • Responding to customer demand • Eliminate Waste • Being responsive to change • Enhancing the effectiveness of the workforce • Creating a mindset of Continuous Improvement Lean+ Mission:Expandthe Lean principles throughout the value stream to enable continued improvement in productivity and long term growth through the business and functions.

5. Waste exists… Wasteful, Non-ValueAdded Steps Exist in Nearly Every Process in any business New Product Research Conceptual and Detail Design Human Resources Marketing Contracts and Pricing Supply Chain Management Scheduling Transportation Manufacturing Product Support Information Systems Systems Engineering

6. Typical causes of Waste • Layout (distance) • Long set-up time • Poor work methods • Lack of training • Functional organizations • Technology Gaps • Historic supervisory roles • Irrelevant performance measures • Lack of workplace organization • Supplier quality/reliability • More…

7. Why Is the Elimination of Waste So Important? Increase Profit Reduce the Cost of Our Products Shorten Time to Market on New Products Shorten Order Lead Time Improve Quality and Delivery Performance Provide Better Customer Service Integrate New Technologies into our Products quicker, and more effectively • Expand Market Opportunities • Make More Profit • Provide Job Stability • Encourage Employee Involvement

8. Detailed customer knowledge and focus Large-scale systems integration Lean enterprise Run healthy core businesses Leverage strengths into new products and services Open new frontiers Leadership Integrity Quality Customer satisfaction People working together A diverse and involved team Good corporate citizenship Enhancing shareholder value Lean Enterprise * Our entire enterprise will be a lean operation, characterized by the efficient use of assets, high inventory turns, excellent supplier management, short cycle times, high quality andlow transaction costs.

9. Why A Lean Enterprise? Becoming a Lean company is vital to reducing costs and thereby giving Boeing a competitive advantage. People working togetheras a global enterprise for aerospace leadership* Boeing - Forever New Frontiers* By implementing Lean practices we can achieve the 2016 Vision: to have a production system that is among the best in the world, characterized by efficient use of assets, short flow times, short cycle times, high quality, and high inventory turn rates. Core Competencies Detailed Customer Knowledge and Focus We will seek to understand, anticipate, and be responsive to our customers' needs. Large-Scale System Integration We will continuously develop, advance and protect the technical excellence that allows us to integrate effectively the systems we design and produce. Lean Enterprise* Our entire enterprise will be a Lean operation, characterized by the efficient use of assets, high inventory turns, excellent supplier management, short cycle times, high quality and low transaction costs. From the ‘Becoming a Lean Company’ brochure: Message from Fred Mitchell and Alan Mulally, October 1999

10. Getting Results • Education - Define what is necessary for different levels. • OJT Training - for anyone implementing or authorizing implementation. • Leadership Commitment- (NOT just involvement, you can’t get credit for checking a box!). • Metrics- The kind that really measures commitment. Cycle reduction, quality, cost, and delivery. • Value Stream Mapping (VSM)-or some flowcharting version thereof. Somehow the critical path has to be visualized so prioritization can occur and cycle waste can be reduced. • Identify and prioritize opportunities.

11. Getting Results • Create theImplementation Planand maintain same. (Yearly, but quarterly would be better.) • Perform a yearly Office Lean Assessment. • Train Lean Facilitators reporting to one person or to the Lean PAT. These Lean experts need to be committed, just like Lean management. If these people are allowed to facilitate part-time, they will loose the commitment.) • Integrate Lean tools and maintain control of their use. Use the right tool for the application. • Maintainthe gain and never quit implementing improvements.

12. Getting Results • Reward the doers, and make sure everyone has the opportunity to be a doer. • Do not create an organizational chart until a Lean Plan is in place and everyone know what responsibility they will have

13. Lean Methodologies and Tools • Identify the key area for improvement • Key Process Identification • Sensing Sessions • Value Stream Mapping • Lean Assessments • Operational Assessment (Quality Function Deployment QFD Analysis) • Root Cause Analysis • Comparative Studies (Benchmarks) • Failure Modes Effects Analysis (Preventive Action) • Other… Determine the best Lean Methodology Accelerated Improvement Workshop Distribution Kaizen Production Preparation Process 6-Sigma Total Productive Maintenance 5s Apply the Lean Tools Visual Controls Standard Operations Continuous Flow Mistake Proofing Set Up Reduction Measures

14. Common Methodology • Understanding and mapping the Value Stream is the foundation • Utilize IDS Standard Value Stream Analysis and Value Stream Mapping Process (Current State / Future Vision / Future State, and Implementation Plan) • Ensure Vision Support Process (VSP) is linked to Future State Map (flow down improvement opportunities) • Organization and Execution • Implementation plan listing overall person(s) responsible, dates and improvement methodology • Utilize standard / simple CI methodologies (AIW, 3P, 6 Sigma, Team Projects) to execute VSM implementation • Conduct reoccurring Lean meetings to review and update implementation progress (at least 1 meeting / month) • Performance Tracking/ Metrics

15. Metrics – Critical Tools • Keep it simple • Measure what’s important • Use to drive continuous improvement • Share with everyone • Update often • Drive to the lowest level possible Business Results

16. Examples… Training Management Systems AIW Mission: To define the future state business processes for SDS Training Management Systems (TMS). …by drive towards identifying the requirements that will allow SDS to integrate and enable a wide array of processes that comprise TMS functions. Sensing Sessions AIW’s Recurring WebEx / teleconference for Follow-on completion of TMS Process Modeling AIW: Accelerated Improvement Workshop

17. Examples… Depot MxM Business Process Modeling AIW Mission: The Depot Level Maintenance Management AIW seeks to model, review, and enhance existing processes for depot-level maintenance, repair, and modification organizations internal to Integrated Defense Systems Identified Tiger Team to further develop “to-be” process model incorporating Lean initiatives and best practices The team reviewed current process challenges, investigated future-state solutions, and identifed touch points and possible synergies between SDS and iGOLD as well as potential Depot Level Maintenance business opportunities Recurring WebEx / teleconference for Follow-on completion AIW: Accelerated Improvement Workshop

18. Examples… Supply Chain Management AIW Mission: To leverage and build upon existing Supply Chain Management process and tools to develop a framework to deliver a common SDS supply chain management offering for IDS. Held Sensing Session early to determine scope for SDS-SCM Integration AIW Conducted AIW’s to build level 4 SCOR processes for planning; part of SPO implementation processes Processes molded into SCS Value Stream Mapping (VSM) – used SCOR as baseline for spares and repairs processes Recurring WebEx / teleconference for Follow-on completion AIW: Accelerated Improvement Workshop

19. Examples… • Field Data Analysis (FDA) AIW • Mission: To enhance existing/create new (Field, Operations, Logistics & Design Data) Data Analysis processes in support of current and future customer/program • needs. To enable Boeing to offer superior support services and product improvement. • Conducted Sensing Sessions • FDA AIW - Create common, future state, integrated process for data analysis. Inclusive of Engineering, Logistics, and other disciplines (IVHM, R&M, SCM, Field Service, LSA, etc.) • Currently meet on regular basis with SME’s and entire team AIW: Accelerated Improvement Workshop

20. Systems Engineering … John Tracy on Systems Engineering John Tracy, VP Engineering, spoke to IDS on the importance of Systems Engineering to Boeing's ultimate success as a LSI (Large System Integrator). "It provides a systematic approach for you to make sure you're meeting the customer's needs across the full lifecycle of the product."  Systems Engineering @ Boeing The systems engineering process at Boeing consists of four iterative steps that transform a customer's needs into a balanced design.  

21. Lean+/Systems Engineering Leadership Team Lean Network Identify Potential Lean Activity VSM, Lean Assessment O&R’s Committed Opportunities Develop Internal Lean Expertise Collect Aggregate Cost & Benefit Data Validate and Target Specific Lean Activity Define Schedule Goals Report Results Conduct Events Identify/Assign Lean Resources Coordinate & Prioritize with Lean Focals Access Lean Resource Database Visibility with Core Lean Office

22. Basically…… Select Process & Appoint Process Team Select The Process & Appoint Process Team Understand The Current Process Develop & Communicate Vision Of Improved Process Identify Action Plan/ Metrics Execute Plan/ Monitor Metrics

23. The Spirit of LEAN • Discard your old attitudes. • Follow-up the planning with Implementation. • SUCCESS comes in “cans”; Failure comes in “can’ts”! • Don’t accept excuses. What will it take to make your ideas work? • Don’t expect perfection up front, a 50% improvement is okay. • Don’t substitute money for brains.Improve the process first, and then apply automation to improve efficiency. • Correct problems immediately. • The people, and management, working together as one team, making improvements. • Ideas from more people is better, especially the people closest to the problem. Sharing ideas, and establishing common goals. • There are NO LIMITS to process improvements.

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25. Back-Up Slides

26. Lean+ Schnettgoecke to Chair PAT Assigns Process Ownership Lean PAT Lean Manufacturing Processes Lean Engineering Processes Lean SM&P Processes Lean Information Technology Business Excellence Lean Contracts and Pricing Processes Lean Program Support Common Systems Integration Customer Support Services Assessments Customers

27. Lean+Resource Team Boeing Operations Council Initiative Leadership Alan Mulally – Sponsor Bill Schnettgoecke - Leader Project Management Resources Alan Mulally - Sponsor John Van Gels - Chair Lean Process Action Team Jan Martinson (IDS Lean) - Chair Mike Herscher (BCA Lean) Terry Finley Shared Services – Lean Vince Tappel (IDS) Lean Manufacturing Ed Dean (BCA) & Steve Junkel (IDS) Lean Engineering Rick Behrens (IDS) & Fredric Hale (BCA) Supplier Development/Global Partners John Eash (IDS) Supplier Quality John Crutchfield (IDS) & Dwight Miller (BCA) Industrial Engineering Tom Spiegel (IDS) & Karsten Overa (BCA) Manufacturing Engineering John Daniels (BCA) & Dave Thole (IDS) Materials Mgmt/Supply Chain Mgmt Dayde McLaughlin Connexion by Boeing Phil Howie Phantom Works – Lean & Efficient Mike Trontell Internal Governance – Ethics Laurie Weise Technology – IT TBD Human Resources & Administration Lean+ supporting the businesses

28. BOEING STANDARDS • Sensing Session – A Sensing Session is a facilitated brainstorming session in which we will set the goals, objectives, scope, and boundaries of the upcoming AIW. • Accelerated Improvement Workshop (AIW) – A rapid, learn/do, rigorous and disciplined workshop requiring detailed planning and commitment to action. It brings all functional people involved in the process together as One Team to achieve improvements in cycle time, cost, quality and customer satisfaction by envisioning possibilities, energetically pursuing opportunities and rapidly implementing process changes. • Business Event Flows – A pictorial depiction of the business process including process activities, inputs/outputs, data elements, connectivity between processes, system and manual tasks, and roles and responsibilities.

29. SENSING SESSION What are we doing today? • Is it a core competency? • Is it profitable? • Is it the right thing to be doing—is it meeting the Customers’ current needs/requirements for Boeing Support? • Is it common/consistent across Boeing (common processes)? • Determine Best Practices • Can it be improved or should it be discontinued?

30. SENSING SESSION cont’d • What do we want to do in the future (5 years out)? • Do we have • Vision Statement? • Strategy? • Goals and Objectives? • Time Table? • Do we have the resources to achieve the goals and objectives? • Financial Resources • Organizational/Leadership Support • Human Resources • Do the Skills currently exist in the organization to support the goals? • If not, are we growing/acquiring the skills? • What is the timeline? • What is the training plan, if growing resources? • From where are we planning to acquire, if acquiring? • Facilities and Equipment

31. SENSING SESSION DELIVERABLES • Goals, Objectives, Mission Statement, Scope and Boundaries for the AIW • Assumptions documented • Agreed uponBaseline processes to align/integrate • Deliverables, outputs, & expectations of the AIW identified • Inputs/Deliverables needed to conduct the AIW identified • KEY participants from your organization for the AIW • identified

32. Non-Factory AIW Timeline

33. Resources • Lean Enterprise Office - http://leo.web.boeing.com/home.cfm • Lean Lingo - http://lean.ks.boeing.com/glossaryr2.htm • Lean Aerospace Initiative - http://lean.mit.edu/