1. A Blueprint To Build Operational
Excellence
Alignment of Purpose, Priorities and
Resources

2. Enterprise Operational Excellence Model 2
Measures of Success How the Model Works
 Key performance indicators  Strategy directed CI focus
 Kaizen event cadence Individual Focus  Order to Cash optimization
 Quick response Counter  Value Stream deployed
Systematic
Measures Transformation
 Rapid Improvement event s
 New product revenues Approach  Highly engaged workforce
 Talent bench strength
fi rm Organizational Focus
Al
Af e
ig
riv
n
D
Dr
ive
Results Culture
Systems
(Behavior Evidence)
Re
le Systems Drive Value
f in
Tools Develop Behaviors b
Ac
na t  Safety EH&S process
e
ec
h
 Flow Toolbox E
ie
l  Quality assurance
Se
ve
 Problem solving tools
 Material flow optimization
 Skills Development
Tools  Voice of the customer
 Value stream rapid
 Enterprise innovation
improvement  Talent development
 Best practice sharing
• Enterprise based system

3. Operational Excellence Transformation Cycle
3
Value Stream Based Rapid Improvement
Process
Identifies how
Identifies how Define what
Define what Value Streams
Value Streams
Sets the Path
Sets the Path Kaizen Make
Kaizen Make
much and how
much and how problems need
problems need Identify Areas
Identify Areas
and Direction
and Direction Improvements
Improvements
far to go
far to go to be solved
to be solved to be Improved
to be Improved

4. Op Ex Transformation Cycle: Implementation Methodology
Steering Committee
Safety
“Lean Tools” deployment
Leadership OpEx Orientation
Through scoped improvement events
Quality
Priorities Implementation
Lean Sigma Plan
VSM
Planning
Problem Solving
Strategic Current Jan Feb Mar April May June
State
VSM VRK 3P VSM
Plan
RIE
STD W MPS STD W
TPI
Future State Delivery
Do-Its Projects
DOE pjt
Pjt
#1 #2 #3 #4
Preparation Cost
RIE
Follow Up Sustainable
Build Capability
Establish a Results
Sustainability
Execution &
Rhythm - Before After 30 60 90 180
N/10 RIE RIE Days Days Days Days
RIE 1
Skills
Quality 8000 3000 2500 2000 1500 1000
Lead time 45 25 23 22 21 20
Productivity 50 43 33 32 32 31
RIE 2
Safety 5 0 0 0 0 0
Progress
Quality 2500 250 244 235 212 199
Review Lead Time 35 21 15 15 14 13
• How Does It Work?

5. How Will The Transformation Happen 5
Review Your Op Ex Commitment and Success Each Quarter
Process Health (1 low, 5 high) 1-5
Leadership Involvement
•Leadership is directly involved in improvement activities including championing OpEx, attending Kaizen events, and attending report outs
Strategic Plan
•Strategic plan will include OpEx transformation plan and how it will improve customer satisfaction, profitable growth and cash generation
Strategy / Policy Deployment
• Goal Deployment action plans specifically include OpEx actions and initiatives
Design To Optimize Flow From Order-to-Cash
• Current state and future state value stream maps that present physical, transactional and informational processes.
Rapid Improvement Event (RIE) Driven Implementation “Kaizen”
• A communicated OpEx implementation plan for the next 90 days.
• Execute with the standard RIE methodology. ( pre-work, targets, execution, review and follow-up) Strive for a N/10 cadence
Dedicated Resources
•1-3% of your workforce is fully trained and100% dedicated to continuous improvement efforts
Involved, Engaged Workforce
• Minimum 25% of workforce is involved in a continuous improvement event every year
• Each associate has been involved in 2 or more events in the past five years
Sustain Results
•Built into Management Process - measure progress and countermeasure as necessary at your monthly business review, weekly staff
meeting, and daily management meeting
•Create an audit cycle that measures sustainability of actions, behavior and results of RIEs.
Total

6. 6
Step-by-Step Operational Excellence Process
Element Of The Op Ex Process:
1. Leadership is directly involved in the improvement process
2. Strategic Plans include OpEx transformation
3. Strategy Deployment process cascades OpEx transformation into action plans
4. Current state and futures state VSM form the foundation for improvement plans
5. Rapid Improvement Event (RIE) driven implementation “Kaizen”
6. Dedicated OpEx resources working from a standard toolbox
7. 25% of the workforce is involved in a continuous improvement event yearly
8. Standard Process for deploying training and monitoring skill development
9. Optimizer System measures and displays OpEx progress metrics
10.RIE audit cycle utilized to capture mistakes and coordinate countermeasures
• Step by Step Approach

7. Operational Excellence Improvement Path 7
• Network 3rd
party resources
• OpEX Skills
Process I
• Launch – RO • Recognizing
Optimizer ce OpEx best in
en
• Systematic System
c ell class sites
approach Ex
• VSM focused al
RIE driven ti on • Dedicated • 1st Wave OpEx
era
Op
• SQDC results leader in place Leader Cert.
• Training base g • Business Unit • Business
approach rovin transformation process CI
• Project base I mp plans • Develop Ops.
application • Supply Core
• Cost savings Segmentation Competency
focus Analysis footprint
• Business
system
innovations
standards
Today 6 Months 9 Months 12 Months 18 Months 24 Months

8. Operational Excellence Scope 8
Operational Excellence - Order-to-Cash
Supply Chain Production Execution
Continuous Improvement (Lean/Quality)
Operational Excellence – Order to Cash
Demand Procurement
Planning & & Accounts Materials Production Distribution & Accounts Order
Management Execution Logistics Receivable Management
Management Payable
One Number Supply Inventory Demand Driven Pick, Pack Invoicing Perfect Order
Plan Management Management & Mixed-Model & Ship Logic
Strategy Policies Flow
Process
nventory, Global Demand Category Purchasing Production Transportation Cash Management Order Types/
ations) Planning Management Methods Flexibility/ Management Policies
Responsiveness
s
r
e
m
o
t
s
u
C
Scheduling Supplier Replenishment Resource Distribution Customer
rocess Templates & Relationship Methods Utilization Center Resource
e-to-Pay) Strategy Management (Labor/Machines) Management Management
S
e
p
u
s
r
Supplier Portal Strategic Inbound Sequencing Compliance Lead Times-
i
l
(SNC) Sourcing Freight Release Management Tiered Pricing
Risk Exposure & Warehouse Network Available to
Mitigation Management Optimization Promise (ATP)
Vertical Order
Integration Entry/ EDI
Supply Production
Continuous Improvement (Lean/Quality)
Chain Execution
• Everything Customer Centric!