1. Improvement That Flows to the Bottom Line Requires • Vision • Focus on Customers and Employees • Active Leadership Involvement and Alignment • Willingness to Break Established Paradigms • Hierarchy of Trained, Empowers, and Incentivized Employees • Constancy of Improvement Activity • Celebrate and Reward Success Dick Lewis Roll Royce COO 2001-2004 MIT 16.660 – Jan 2008

2. Notes • Teams • DMAIC (adapted from the Deming Cycle) • Define (Process map, problem definition, metrics, improvement goals) • Measure (Process analysis, statistics, data collection & analysis) • Analyze (Data analysis, Lean, FMEA) • Improve (DOE, Kaizen, Non-value eliminated) • Control (Poka-Yoke, 5S, Kanban, SPC, TPM)

3. notes • Metrics (defined by the voice of the customer) • On-time delivery • Delivered Product Quality • First Pass Test Yields • Past Due receivables • Capital ROI • Started with “Low hanging Fruit” • 5S, multi-skills training, supply chain • Leadership Team, metrics, organizational restructuring, focus on data • Saved 3% ($150M the 1st yr)

4. notes • Reduce the Barriers to Change • Define the burning platform • Obtain buy-in from key stakeholders • Communicate3 • Dispatch the resistance • Reward Results (recognition and rewards)