Barry J Novotny R,D& E Business Manager Kennametal, Inc.

1. Kennametal, Inc. Successful New Product Launch KenTIP Barry J Novotny R,D& E Business Manager Kennametal, Inc.

2. Company Description: Kennametal is a global company with over $2.4B in sales last fiscal year. Over 40 Mfg.locations around the globe. New Product Development is critical to Kennametal’s continued success in the Metal Cutting and Advanced Materials Markets in which we compete. Before the implementation of ACE we had a mere 17% of our total revenues came from New products, today that number is over 40% and climbing. ACE is at the core of Kennametal’s value business system and it has become the way we work at the development of new products and processes. Product/Service Description: Brand name:KenTIP Launched : September 2003 Product: Modular drill where the worn cutting edge is easily replaced. Drill must have the same performance as a SCD. Brand new product for Kennametal Kennametal, Inc.Barry J. Novotny Disposable Insert Reusable Steel body = competitive advantage Works without a screw, bolt, or spring. Drill can be kept in chuck while tip is replaced. Significant cost and time savings to customer.

3. Illustration of the Stage-Gate Process you used for this Product/Service: Description of Stage-Gate Process for Product/Service: Kennametal has named its stage gate process ACE – Achieving a Competitive Edge. We began the implementation of this process in late 1999, at which time our NPS were only 17% of total revenues. For KenTIP - Use of the ACE process(Stage Gate) helped both the project team and gate keepers work effectively throughout the project. The need for this project was derived as a reaction to a competitor’s product and the need for KMT to begin to compete in the small modular drilling arena. Early on in the process the technological challenge was viewed by some as an impossibility. The project team drove the organization to expand its’ capabilities in the areas of engineering, manufacturing and quality, guided by the steps laid out in the later stages of the process. The initial scores of this project we mediocre at best, only to improve to 48 at gate 4 and 50 at gate 5 as the team achieved the projects objectives. Launch of this product to market lead to the issuance of 4 global patents protecting the technology. The success of the KenTIP project both expanded the technology base and was also instrumental in defining and reinforcing the need for the use of the Stage Gate processes at Kennametal. Kennametal, Inc.Barry J. Novotny

4. Lessons Learned: Team remained unified in its direction throughout project. Project success was partly due to the strong and effective leadership – leader respected and valued all team members and their ideas. Team maintained a commitment to a high level of quality and performance – did not compromise to ease manufacturability. Project leadership skills directly correlate with the success of the project, specifically in the area of communication. Global aspect of project team made for difficult beginning. Face to face kick off would have been more effective and efficient. KMT Stage Gate Process improved due to the lessons learned from this team’s experiences. Product/Service Team: Kennametal, Inc.Barry J. Novotny Product/Service Performance: • Exceeds forecasted sales goals • Exceeds performance objectives • Combines high performance with quality. • Tech. Breakthrough • Team: Cross functional Global team that worked exceptionaly well together which given the technical challenges was critical to the success of the project. • Gatekeepers: Accepted the technical leadership given by of the team and provided full support and resources throughout the length of the project.