1. LOCKHEED MA
Published for the employees of
Lockheed Martin Control Systems
C- 17 Adoptotion leqds
To Cosf Cufs On S-3Cost is a vital factor in bidding any
product, whether it's commercial or
military.
But as the product moves down the
pipeline from bid to design to develop-
ment to production, cost can become a
victim to other concerns.
So when Control Systems won the
contract to produce the Digital Flight
Data Computer for the Lockheed
Martin S-3 Viking, the cost of the item
was kept foremost throughout the
development proc6ss, according to Pat
Shannon, program manager.
"This was very much a design-to-
cost effort," he explains. "Our pricing
was locked in f.or 77 production units
Teels To Visit
Johnson City
Pete Teets, Lockheed Martin
Corporation Executive Vice President
and chief operating officer, will visit the
Johnson City plant next Friday, August
15, on a get-acquainted trip. He will
tour the facility and receive briefings
on Control Systems businesses and key
programs.
It's part of a get-acquainted tour of
various facilities; he will tour the
Owego facility in the afternoon.
Teets, who had been president and
chief operating officer of the
corporation's Information & Services
Sector, assumed his current post last
Friday upon the retirement of Norm
Augustine as chief executive officer of
the corporation.
Teets was formerly president of
Martin Marietta Astronautics and the
corporation's Space Group. He holds
bachelor's and master's degrees from the
University of Colorado. In addition, he
was named a Sloan Fellow and received
a master's degree in management from
Massachusetts Institute of Technology.
August 7, 1997 Johnson City, Newyork, and FortWavne. lndiana
through the year 2001, and we knew
that decisions made in the development
phase would cast the die for the
production phase." For example, the
power supply is an adaptation of a
similar component in the Electronic
Flight Control System for the C-i7
Globemaster III, Pat noted.
"Right from the start, we knew we
had to hold costs to a minimum on the
S-3 computer, because we were very
aggressive in bidding the job. So we
formed a multi-function team to ensure
that we could develop and produce the
best system available, yet still meet cost
objectives."
That's why the team decided to
reuse the C-17 power supply even
though the S-3 board was bigger. "By
using an existing design, we were able
to cut back drastically on design costs,
reduce development risk and leverage
off the C-17 material buys," he added.
The team set cost targets in all the
labor-related areas for each subassem-
bly, such as assembly, test and inspec-
tion, then challenged those targets by
an additional 10 percent.
"Then we did the same thing with
the computer's parts
-
set a target by
subassembly, then challenge that target
by another 10 percent," Pat said.
And the concentration on costs
didn't stop as the team moved through
the development process
-
for ex-
ample, by stepping back and looking at
the design as it was evolving. "If it
wasn't meeting cost objectives at any
level, we went back and redesigned it
so that it met the objectives."
Another key step was keeping
suppliers informed. "On the higher-cost
items such as connectors, motherboards
and chassis, we called our suppliers in,
gave them advance copies of our
drawings and asked them to work with
us on costs. This enabled them to give
us suggestions on how to reduce costs
further. By listening to our suppliers, we
(Continued on page 2)
Nancy Payne prepares an S-3 Digiral
Flight Data Computer boardfor assem-
bly on the Quad machine in the board
room.
GE Reporls
Key Moves
General Electric Company has
announced several executive changes
that will affect Lockheed Martin
Control Systems customers in the GE
family.
In the top move, Eugene Murphy,
61, president of GE Aircraft Engines,
has been named vice chairman and a
director of GE. Murphy had been
president of GE Aerospace until its
1993 merger with Martin Marietta.
He will be succeeded as head of
the engines unit by W. James
McNerney, h.,4'1 , who had been head
of GE Lighting in Cleveland and who
continues as a corporate senior vice
president. McNerney is a graduate of
Yale University and Harvard Business
School.
In another move affecting a
Control Systems customer, McNerney
(Continued on page 2)

2. c-17. . .
(From page 1)
were able to meet our cost objectives on
the program," Pat explained.
By combining similar material
requirements, the team was able to
make long-term commitments with the
suppliers that also helped reduce costs,
he added.
And a software tool developed by
Joe Gustainis helped make easier the
selection of the lowest total cost
resistors and capacitors for the design.
'As a result of this tool
-
which,
incidentally, is being used now in other
programs
- we were able to automate
over 90 percent of the surface-mount
components using a new automatic
insertion machine called the "Quad"
and save four to five hours oftouch
Iabor on each analog board," Pat said.
Other members of the S-3 team
include:
Engineering - Randy Franklin,
Scott Hatch, John Lee, Mike Misner,
George Mrozowski, Steve Pero, Mark
Ruscak and Al Wildrick'
Operations - Ceo.ge Buffum, Mike
FitzPatrick, Marilyn Giorgio, Bob
GEMoves...(From page 1)
will be succeeded at GE Lighting by
David L. Calhoun, 40, currently
president of GE Transportation Systems
(GETS) in Erie, which produces
locomotives and other vehicles that use
Lockheed Martin systems. Calhoun,
who also is being named a corporate
senior vice president, is a graduate of
Virginia Polytechnic University.
Calhoun, in turn, will be succeeded
at GETS by John G. Rice, 40, currently
president of GE Plastics' Pacific
operations. Rice, a former vice presi-
dent of the GEAudit staff, is a graduate
of Hamilton College.
In other moves, GE also announced
that Paul F. McBride will succeed Rice
as president of GE Plastics-Pacific;
Denis J. Nayden, president of GE
Capital Services, has been additionally
named a senior vice president of GE;
and James W. Rogers has been named a
senior vice president along with his
post as president and CEO of the newly
named GE Industrial Control Systems,
formerly GE Motors and Industrial
Systems.
Kolpakas, Scot Lockman and Tom
Ratliff.
Another key member of the team
was Tom Cirillo of MAC/]vIAR who is
now a Control Systems employee.
"In addition to weekly design-to-
cost meetings with the core team during
the design phase, we also conducted a
number of brainstorming sessions with
an extended team to get ideas on how
to reduce or eliminate cost drivers
altogether," Pat pointed out.
The end result was a fresh way of
looking at costs and the factors that
drive those costs, Pat noted.
Among the key points learned from
this were:
. "You have to spend some money
effectively to save more. For example,
by investing $75,000 in design-to-cost
trade studies for the S-3, we saved an
estimated $500,000
-
and those
savings could go higher.
. "You need to get the labor and
material targets in front of the designers
and continuously feedback and assess
as the design evolves."
. "We never stopped focusing on
costs. Cost was as important a factor as
schedule and technical performance.
And we're still doing that as the
program transitions from development
to production
-
looking for ways to do
it smarter, better and cheaper.
. "We learned that we can control
costs by using standard, off-the-shelf
materials/designs, selectively use
industrial-grade parts and use highly
automated processes."
The result is a system for the S-3
that not only met but exceeded the
team's objectives on costs, and a
process that can be migrated to other
programs to help keep prices lower for
other Control Systems customers.
Toner Cortridge
Scom Reqppeors
Johnson City employees and
managers have reported receiving
phone calls offering fax and printer
cartridges at what are purported to be
cut-rate prices. Actually, the low prices
are much higher than the company
currently pays.
In any case, the only authorized
purchaser of such supplies in Facilities,
according to Jodi Dribnak, who asks
that anyone receiving such calls
transfer the caller to her at extension
3 Chonges
ln Business
Deyelopmenf
Three changes in his organization
have been announced by Doug Becker,
director of Business Development.
Rich Hopf, formerly program area
manager for Engine Controls, joins
Business Development as the Engine
Control Business Area Team leader,
succeeding Dave Whritenour.
Dave has been reassigned to
support the Aerospace business with
lead Business Development responsi-
bility for Northrop Grumman, Califor-
nia and Lockheed Martin Thctical
Aircraft Systems in Fort Worth, with the
exception of Joint Strike Fighter, which
will remain the responsibility of Brett
Hush.
In addition, Barb Smart joins the
Business Development organization to
support the Industrial Controls busi-
ness, reporting to Denyse LeFever.
2096. The bottom line is: Don'r order
supplies for your office equipmenr from
anyone outside the facility, Jodi adds.
She'll answer any questions you may
have on the subject.
Questions about your benefits?
Call the Corporate Benefits Help Desk
at 1-800-662-2363.
Compony 100tr"
ln Ethics Troining
Control Sysrems is now 100
percent trained in '"The Ethics
Challenge," according to Tom
MacDuffie, company Ethics offrcer,
percent two weeks ago, and the last
five Johnson City employees
completed the training last week,"
Tom noted. Control Systems
reached the 100 percent mark more
than two weeks ahead of the
Electronics Seetor deadline of ,
August 13, Tom said, adding, "It's
a tribute to the Control Systems
workforce in both plants that
completion of the training went so
smoothly"