Copyright © 2006 Six Sigma Solutions LLC The scientific approach to operations performance improvement SIGMA S o l u t i o n s SIX 0 SUMMARY OF OPERATIONS

Copyright © 2006 Six Sigma Solutions LLCThe scientific approach to operations performance improvement

SIGMAS o l u t i o n s

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SUMMARY OF OPERATIONS IMPROVEMENTS

September 2005

IRON & ALUMINUM FOUNDRYAutomotive, Agricultural & Industrial Parts & Assemblies



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FOREWARD

This document outlines the financial benefits of operations improvements made across 5 iron & aluminum foundries over a 6 month period in 2005.

The scope of each operations improvement was defined by the client.

The financial benefits were achieved as a direct result of improvements in productivity, reductions in inventory, increases in labor efficiency, reductions in headcount, better quality products & faster throughput.



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CONTENTS

TOPIC Page

SUMMARY OF RESULTS 2

PLANT 1 IMPROVEMENTS 3-6





PARTNER BIOS 58-63

CONTACTS 64



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SUMMARY OF IMPROVEMENTS

LOCATION

TOTAL COST

REDUCTION

($K)

CAPEX

REQUIRED

($K)

PROJECT COST

($K)

Plant 1 630 652 310

Plant 2 358 97 355

Plant 3 2,170 209 532

Plant 4 1,414 216 160

Plant 5 142 93 68

TOTAL (5 Plants) 4,714 1,267 1,425



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PLANT 1

Implement a Lean methodology in the grinding room to reduce costs & improve productivity



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PLANT 1 GRINDING SHOP

BEFORE



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PLANT 1 GRINDING SHOP

AFTER



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IMPROVEMENTS

METRIC START FINISH

GRINDING ROOM EMPLOYEES 71 53

COST PER TON ($) 89.60 66.91

PCS/MAN HR GROUND 26.5 42.7

INVENTORY ACCURACY ~70% 98%

TOTAL COST SAVINGS ($) 630K

PRODUCTIVITY



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PLANT 2

Reduce grinding/shipping labor & reduce WIP/finished goods inventory



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PLANT 2 ALLEY

BEFORE AFTER

WIP REDUCTION



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IMPROVEMENTS

METRIC START FINISH

WIP REDUCTION (K lbs) 525 98

GRINDING/SHIPPING HEADCOUNT 139 126

TOTAL COST SAVINGS ($K) 358

WIP



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PLANT 3

Coordinate QJS molding improvement project for improved output (molds/hr) and labor savings



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QJS MOLDING LINE SCHEMATICS

Flask StationFlask Station

Drag

Lift

Close Out

Tip Over

Cope

Lift

Pouring &

Shakeout

CartCart

Key

P=Productivity Increase

DR= Defect Reduction

P=10%

DR=1%

P=1%

P=14%

DR=1%

P=1%

P=5%

P=1% DR=1%



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QJS MOLDING LINE



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IMPROVEMENTS

METRIC BASELINE PROJECTED CHANGE

PRODUCTIVITY (MOLDS/HR) 4.1 5.5 +34.0%

DEFECTS (%) 13.0 9.8 -24.6%

CAPEX ($K) 116 116 0

TOTAL SAVINGS ($K) 643

PRODUCTIVITY



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PLANT 3

Improve labor productivity, material handling logistics & scheduling in core making department to improve core machine utilization & percent uptime yielding more core blows per hour, cores per hour



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#1 CORE ROOM - CURRENT LAYOUT & FLOW

Mud & Gas Delivery Route

Extremely short loading & stacking area

Severe congestion

Mezzanine

Cauffiel too close to oven, no surge area

Dog Bone

RedfordRedford Redford RedfordCauffiel

WIP

WIP

WIPWIP

WIP

WIP

Bulk storage of gasses & mud

Obsolete shell core machines

WIPWIP

Core Assembly Shell Core

Shell Core

Dipping vats topped up by hand

CoreAssembly

WIP



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INEFFICIENCIES - SCHEDULING

Typical Schedule

Suggested Schedule

Example: Part # - X62008367, Quantity = 100

Laempe

Redford

Corefit

Queue Queue

Queue

Redford (1370 mins)

Cauffiel (548 mins)

Corefit (1454 mins)

T=1370 mins

Cauffiel (548 mins)

Corefit (1454 mins)

Redford (1370 mins)

T=1868 mins

Potential Time Saving,

Δt = - 498 mins

Process



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INEFFICIENCIES - EXAMPLES OF WASTE

Overproduction

Idle Machinery

Scrap

4 day old product

Mishandled & broken cores



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INEFFICIENCIES - NON VALUE ADDED ACTIVITIES

Cauffiel

Cope

Dip

Pour

Iron

QueueQueue

Cure

Cauffiel

DragCore Fit

Queue

Queue Queue

QueueQueue

Queue Queue Queue = transport

= waiting

= value added

Typical Core Making Process

Multiple queues build up between handling & relocation of product




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INEFFICIENCIES - BOTTLENECKS

Oven capacity lower than dipping

Long queues

Dipping capacity lower than core fit & assembly

Excessive WIP



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#1 CORE ROOM - PROPOSED LAYOUT & FLOW

MezzanineDog Bone RedfordRedford

RedfordRedford Cauffiel

Shell Core

Shell Core

RedfordRedford RedfordRedford

Tooling delivery route

Mud & gas delivery route

Oven stretched & moved back

All dipping vats auto refilled

Supervisors’ Office



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IMPROVEMENTS

Decreases core box changeover times and

makes tool searches more efficient.

BEFORE AFTER

Shadow boxes constructed and installed at every core making machine.



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IMPROVEMENTS

BEFORE AFTER

LINE OF SITE



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IMPROVEMENTS

ORGANIZATION

BEFOREAFTER



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IMPROVEMENTS#1 Core Room Activity

17%

12%

18%

1%9%3%

39%

1%

Transport

Walking

Communication

Inspection

Waiting (Machine Running)

Waiting (Machine NOT running)

Working (Producing parts)

Tidying Up

#1 Core Room Activity

22%

9%

9%

0%

13%4%

43%

0%

Transport

Walking

Communication

Inspection

Waiting (Machine Running)

Waiting (Machine NOT running)

Working (Producing parts)

Tidying Up

BEFORE (Jan 05)

AFTER (Mar 05)

VALUE ADDED ACTIVITIES

Over 10%

improvement



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IMPROVEMENTS

Headcount

36

38

40

42

44

46

48

January February March April

Year 2005

Revenue Per Hour

$250

$275

$300

$325

$350


Year 2005

Revenue Employee

$45,000

$55,000

$65,000

$75,000

$85,000

$95,000




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BEFORE AFTER

IMPROVEMENTS

WIP REDUCTION



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IMPROVEMENTS

METRICBEGINNING

JAN ‘05MAY ‘05

PROJECTED

(12 MONTHS)

CHANGE

(%)

PRODUCTIVITY

(COMPLETE CORES PER HR)26 29 40 + 54

DOWNTIME (%) 28 25 15 -53

MAN HRS PER CORE (HRS) 0.18 0.15 0.12 -54

* Includes individual & assembled cores

PRODUCTIVITY



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IMPROVEMENTS

METRICBEGINNING

JAN ‘05MAY ‘05

PROJECTED

(12 MONTHS)

CHANGE

(%)SAVINGS ($K)

SCRAP ($K) 480 240 240 - 50 240

WIP ($K) 50 25 14 -72 36

OVERTIME (%) 115 60 28 -75 87

AVERAGE COST PER CORE* ($) 5.68 5.44 3.63 -36 308

HEADCOUNT 46 40 41 -10 100

TOTAL ANNUAL SAVINGS ($K) 771

COST REDUCTION



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PLANT 4

Assess benefit of real time monitoring of the grinding/finishing output through the application of touch screens concept installed at Plant 1



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PLANT 4 GRINDING ROOM

BEFORE AFTER

Bottleneck 1 man, 1 touch flow2 man, 2 touch flow Visible productivity display



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IMPROVEMENTS

1 Piece Flow Comparison (#23523166 - Exhaust Rocker Arm)

45.1

54.1 55.0 55.052.6

49.2

42.9 42.9

57.1

35

40

45

50

55

60

20thJanuary

21stJanuary

22ndJanuary

26thJanuary

27thJanuary

27thJanuary

28thJanuary

31stJanuary

Pie

ces

Per

Hou

r

1 Piece Flow Rate

Historical AverageLearning phase: new partfor operator, new set up.

PRODUCTIVITY



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IMPROVEMENTS

Pass Quality Check Pushbutton

Yellow arrows show 1- touch work flow through grinding operation

1 - PIECE, 1-TOUCH FLOW



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IMPROVEMENTS

MetricEfficiency

BeforeEfficiency

AfterChange

1-Man Processing(Part # 301590)

102.2 112.5 +10.0%

2-Man Processing (Part # 23523166)

125.0 141.0 +12.8%

PRODUCTIVITY



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COST BENEFIT ANALYSIS

ITEMCAPITAL

REQUIRED ($K)

TOUCH SCREENS, DISPLAYS & DATA HIGHWAY 93

TOTAL SAVINGS ($K) 142



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PLANT 5

Assess benefit of “real time” monitoring of grinding-finishing output through application of “touch screens”



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CURRENT GRINDING ROOM LAYOUT

Most grinding in plant 2 is done with a 2-man set up.

There are frequent bottlenecks at the first grinder resulting in excessive waiting by the 2nd grinder for work.

1st grinder

2nd grinder



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PRODUCTION FLOW

Raw Castings

Queue on Belt Queue 1st Grind

Inspection

Sort

2nd Grind QueueQueueQueueQueue

PLANT 2 GRINDING SHOP PROCESS FLOW

Raw Castings

Queue on Belt Queue1st & 2nd Grind

Inspection

Sort

QueueQueueQueue

t = 0

t = 0

Present

Forecast




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PROPOSED GRINDING ROOM LAYOUT

1st / 2nd Grinder

Sorter

Forklift driver

Gravity Feed

• Headcount reduced

• Bottlenecks removed

• Faster throughput



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IMPROVEMENTS

EFFICIENCY PRESENT FORECAST CHANGE

HEADCOUNT (N) 39 30 -9

PRODUCTIVITY (LBS/MAN-HR) 1,160 1,334 +15%

COSTS PRESENT FORECAST CHANGE

ANNUAL DIRECT LABOR COST ($K) 1,175 903 -272

LBS GROUND (MILLIONS) 23.9 27.5 +3.6

GRINDING ($/LB) 0.077 0.065 -0.012

ANNUAL COST ($K) 1,840 1,788 -52

TOTAL SAVINGS ($K) -324

PRODUCTIVITY



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.

PLANT 5

Improve scheduling (melt-mold-core making-finishing-shipping-outside vendor) systems and logistics to improve material flow, reduce lead time (receipt order-to-ship) and improve on-time delivery to customers



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SUMMARY

Value Streamed “Order - To - Cash” Identified Process Breakdowns Identified Corrective Actions ABC’d Cores By Priority (Cost & Complexity)

Recommended Formal Cycle Counting Program Recommended Samples Included As Part Of Master Schedule Formalized Plan To Realize Inventory Accuracy Goals



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C u s to m e r 1 . Fa x e s ,e m a i l s , h a r dc o p i e s o r d e r s

2 . C o n f i r m s P . O ,.r e c e i p t o f o r d e r

C T 1m in

O rde r En try 3 . R e vi e w s o r d e r f o rc o m p l e te n e s s /a c c u r a c y

C T 1m in

4 .C om p leteA ccu rate?

y e s5 . En te rs o rde r

C T 1 m in

no

6 . C o n t a c t sc u s to m e r /c o r r e c t s

C T 1 -2 w e e k s

A dm inR e wo rk

7 . S ta m p s , i n i t i a l s,d a te s o r d e r

C T 1m inA

O rde r En try A

8 . Faxe sac k n owle dg e m e n t to

c u s tom e rC T 1 m i n

9 . Prin t sa ck n o wle dg e m e n t

C T 5 m in

1 0 . S o rtspa pe rwo rk

5 . m in

11 . C om p aresackn ow led gem en t to P .O .

2 m inB

no

1 2 . r e e n te rS te p 5C T 1 3 m in

y e sB

1 3 . M ai l c opy ofA c k n owle dg m e n t

to C u s tom e rC T 1 m i n

1 4 . S ta pleA ck n o wle dg e m e n t P . O .

C T 1 m in

1 5 . F ileC T 1 m in

1 6 .P r ovides ta tu s t o

c u s to m e r 1 -1 2 0 m in

M a s te rS ch e du le r

1 7 .R e v ie wss h o p o rde rs

cre a te d f ro mo rde r e n try

c 1 8 .C r e ate swe e k ly s c h e du le

C T 2 h r ' s

19 . . . A ll resou rcesava ilab le y e s 2 0 . S ch e du le s

2 1 A . O rde rS it s C T 1h r-2 wk s

n o ca u s e s de la y

D

c

VALUE STREAM MAPPING EXAMPLE



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STEP #3 - IDENTIFICATION OF PROCESS BREAKDOWNS EXAMPLE

Wrong Pricing (Customer Documentation / Old Pricing) Wrong Delivery Dates Incorrect Revision Level

No Set Up Charge Wrong Quantities Wrong Shipping Address



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STEP #3 – cont’d

Wrong Customer Information In System – Documents With Old Pricing Waiting On Customer To Respond Lead Time Deterioration

Conclusion:

Contract review process is broken and requires PROCESS ACTION TEAM to re-engineer process to address causes and to determine corrective and preventive action



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PLANT 5

Improve productivity and through-put in core making operations to reduce costs and improve scheduling logistics for molding operations



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CORE INVENTORY

High volume of finished core inventory yet schedule consistently 3 weeks overdue and customer delivery only 75% on time



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IMPROVEMENTS

SAVINGS % SAVINGS %

PRE-STAGE TOOLING 3 OPERATIONS 6

PRIORITIZING JOBS 2 IMPROVED YIELD 3

START UP PROCESS 3

GOALS & METRICS 2 FASTER SET UP 3

TOTAL SETUP 10 TOTAL CYCLE TIME 12

Through Value Stream Mapping, set up time was reduced by 10% and cycle time was reduced by 12% for a total saving of $372K.

SPEED



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PLANT 5

Create process improvement – scrap rate reduction methodology/team to reduce in-house scrap rate and customer returns



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COST OF SCRAP CAUSED BY DIRT

INTERNAL SCRAP

YEAR ’04

COST ($K) 1,470

% OF TOTAL 40

CUSTOMER RETURNS (EXTERNAL SCRAP)

YEAR ’04

COST ($K) 33

% OF TOTAL 40



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SCRAP REDUCTION METHODOLOGY TRAINING

Pareto AnalysisSet priorities & ensure efficient use of resources

Fishbone Identify root cause

Action Plan (PAT – Process Action Teams)Identify, re-engineer processes & take corrective action

Line GraphMeasure effectiveness

ImplementAccountability & management

review



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IMPROVEMENTS

SCRAP CAUSED BY DIRT (%) OF TOTAL SCRAP ($)

$0

$200,000

$400,000

$600,000

$800,000

$1,000,000

$1,200,000

$1,400,000

$1,600,000

$1,800,000

$2,000,000

FY

200

1

FY

200

2

FY

200

3

FY

'200

4

FY

TD

'200

5

Oct

-04

Nov

-04

Dec

-04

Jan-

05

Feb

-05

Mar

-05

Apr

il '0

5

May

'05

June

'05

July

'05

Aug

'05

Sep

t '0

5

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

SCRAP CAUSED BY DIRT (%) OF TOTAL SCRAP ($)



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IMPROVEMENTS

GOAL: Identify, document and reduce internal scrap and customer returns caused by dirt

SCRAP CAUSED BY DIRT ($)

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

$500,000O

ct-0

4

Nov

-04

Dec

-04

Jan-

05

Feb

-05

Mar

-05

Apr

il '0

5

May

'05

June

'05

July

'05

Aug

'05

Sep

t '0

5

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

SCRAP CAUSED BY DIRT ($)



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PLANT 5

Implement line-of-sight visual management techniques



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LINE OF SIGHT METRICS

Plant 2 Total May 2005 MTD

9.4%7.3%

5.8%

1.0%

3.0%

5.0%

7.0%

9.0%

11.0%

13.0%

15.0%

1005 14 x 19 2111 797 20 x 24 2131 2457 20 x 24 2133

Machine

Pcs S

cra

p /

Pcs P

roduced

GOAL 7.8%



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MONTHLY LINE OF SIGHT MANAGEMENT MEETING



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IMPROVEMENTS

IMPROVEMENT ACTION

REDUCED INTERNAL SCRAPTrained Six Sigma tools & creation of Process Action Teams who focused on dirt

BETTER ON TIME DELIVERYEliminated process breakdowns identified in “Order-to-Cash” process map

HIGHER CORE ROOM INVENTORY ACCURACY

Implemented cycle count program

LOWER CUSTOMER RETURNSTraining Six Sigma tools & creation of Process Action Teams who focused on dirt



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ACTION CURRENT PROJECTEDCHANGE

(%)SAVINGS

($K)

INTERNAL SCRAP REDUCTION ($K) 5,336 4,269 20 1,068

ON TIME DELIVERY 76% 95% 19 -

CORE ROOM INVENTORY ACCURACY 50% 90% 40 -

*CUSTOMER RETURNS ($K) 1,108 886 20 222

TOTAL SAVINGS ($K) 1,290

IMPROVEMENTS

* Current run rate

COST OF QUALITY



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BIOS cont’d

Carl has a Master Lean Certificate, a Six Sigma - Master Black Belt Certificate and a Six Sigma - Green Belt Certificate from Villanova University, PA.

He earned his Bachelor of Science Degree in Technical Business from Athens State College, Alabama. He also has a Machine Shop and Tool and Die Certificate from John C. Calhoun State Community College, Alabama and a CNC Machine Technology Certificate from Drake Community College, Alabama.

As Vice President for MTSI in Huntsville, AL he grew the firm’s revenues from $1 million to $6.6 million in four years by meeting tough defense contract specifications and exceeded expectations by winning contracts for programs such as Bell Helicopter: 609 Program Tooling, PPG Bombardier: Aircraft Windshields Design and Modeling, and General Motors: Saturn Manufacturing Tooling. He also led hardware implementations for Operations Support and Engineering Personnel for the International Space Station.

On behalf of Vought Aircraft Industries, Carl served as a Member of their Corrective Action Board to implement Lean Manufacturing for key programs such as Airbus, Gulfstream GIV, GV Wing Assembly and the revolutionary V22 Osprey. This resulted in reduced costs, improved quality, retention and extensions of various defense and commercial contracts.

CARL E. WATSON Jr.



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BIOS cont’d

At GKN Aerospace Services, he worked with Industrial Engineering Estimating and Lean Manufacturing Optimization where he helped them retain and win new defense and commercial contracts by developing highly efficient methods of manufacturing.

At Pratt and Whitney, he was the Lead Senior Manufacturing Engineer in the Advanced Systems Division where he worked on the Advanced Cruise Missile and the Tomahawk Cruise Missile. He was also a member of their Material Review Board for Manufacturing and as SPC Team Captain, he conducted statistical process control training classes and wrote SPC procedural policies for their operations personnel to improve the quality and efficiency of their manufacturing operations.

During work on various defense contracts, he completed a Government Compliance Seminar, Federal Acquisition Regulation and Total Quality Management training.

CARL E. WATSON Jr. cont’d



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CONTACT US

PARTNERS

Carl E. Watson Jr. BSc, Master Lean, Six Sigma Master Black Belt

Cell: 256-337-9811

[email protected]

OFFICE

PO Box 3375

Hunstville

AL 35810

[email protected]

http://www.sixsigmasolutionsllc.com



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END