KCRIMS / NSMCKansas City Responsive Infrastructure Manufacturing & Sourcing

National Secure Manufacturing Center

National Nuclear Security Administration

Kansas City Plant Transformation

“The KCRIMS project, including the NSMC facility, is a cornerstone of the future success of the DOE.” - Steven Chu

Secretary of EnergyRick Lavelock

Sr. Program Manager Honeywell FM&T

KCRIMS / NSMC Program TimelineCalendar Years Shown

SEABReport

RI Roadmap

NNSAJanuaryProcess

D’AgostinoCongressional

Testimony

First KCRIMSTransformation Plans

Joined GSA forFacility Acquisition

KCRIMS DraftBusiness Case

KCRIMS FinalBusiness Case

CD-0

CD-1

NEPA EADecision NEPA

NOI

Site Selection &Press Release

SAIC AlternateSite Study

Draft EA PublicComment Ends

OMBApproval

SolicitDevelopers

CongressionalApproval

FacilityAcquisition

Report

StrategyTeam

FunctionalTeams

MitigatedFONSI

RestartSolicitation

Lease / PIEANegotiations

20053 4

3 42007

1 2 3 4

1 2 3 42006

1 2 3 4

1 2 3 42008

1 2 3 4

1 2 3 4

GSABid

Bust

IPR

ShortList

BidsReceived

DeveloperSelected

NRDCNEPA

Suit Filed

NSMCMOA

BAFO

20091 2 3 4

1 2 3 4

NEPABriefs

Completed

LeaseAgreement

PIEAFinalized

NEPASuit Win

2010

NEPAAppeal

Dismissed

FinancingSecured

Lease SignedConstruction

Start

1 2 3

1 2 3

KCRIMS Transformation Plan Elements

Reduces footprint over 50% and operational costs by 25%Reduces footprint over 50% and operational costs by 25%

RevisedGovernance

MaintenanceOf Cold WarEra Capacity

and RedundantCapabilities

2005KCP

Business Process

Transformation

StrategicSourcing& Sizing

NewFacility

ResponsiveInfrastructure

• 65 years old • 3.1 M ft2

• 2950 employees• High fixed costs• Low utilization• 55% outsourced

• Modern Infrastructure • 1.0 M ft2 (DP Mission)• 2300 employees (given

same workload)• Low fixed costs• Reconfigurable• 70% outsourced

TransformationElements

IntegratedInterdependent

Enterprise

CommercialSupplyBase

CommercialSupplyBase

2014KCP

Enablers TransformationActions

KCRIMS

Current Bannister Federal Complex

NNSA 3.1 M ft2 Controlled2.8 M ft2 In Use

GSA& Tenants 2.0 M ft2 Controlled

National Security Campus Site Plan

For the 20 year lease, the real estate assets will be:

• Owned by: PIEA

• Designed, built, financed and maintained by: CPZ

• Leased by: GSA

• Occupied & operated by: NNSA/Honeywell

Facilities design for flexibility to accommodate all plausible stockpile scenarios.

Site Construction Progress

KCP Transformation Schedule Summary

2006

Integrated Phases for a Comprehensive Transformation

2007 2008 2009 2010 2011 2012 2013 2014 2015

Facility Acquisition &Business Transformation

Phase 1:

Phase 2: Occupancy ProjectIncluding Relocation

Phase 3: Bannister DispositionPlanning & Execution

PrivateConstruction Rolling 19

Month Relocation

Final IT &Security Install

Cost

$138M

$705M(Private Funds)

$291M($264 KCRIMS)

($27 NSMC)

$85M

_______

$1,219M

KCP Operating Requirements

55% Reduction in Operating Requirements

DirectiveBefore

Transformation

After Transformation

(1/30/2007) 1/31/2008 1/31/2009 1/31/2010

DOE Orders 87 30 31 31 41

DOE Regulations 13 5 5 5 5

DOE Requirements 30 11 10 10 11

NFPA 14 12 12 12 2

Standards/Codes 8 8 8 6 6

Other 8 7 7 7 7

Total 160 73 73 71 72

0

50000

100000

150000

200000

250000

300000

FY yr end

Sq

uar

e F

eet

Plan 303210 178000 158000 141000 128000 112300 97800 80800 60000

Actual 196691 178000 157800 140800 127000 111900

2005 2006 2007 2008 2009 2010 2011 2012 2013

0

2000

4000

6000

8000

10000

12000

1 2 3 4 1 2 3 4 1 2 3 4

Actual

Committed

KCRIMS StatusOutsourcing

204/204 Parts = 100% CompleteBuild Aheads

10,352 Pieces Complete = 117% of Plan

Inventory ReductionSpace Requirements Reduced 63%

Business Process TransformationCumulative Labor & Expense Savings = $236M

Hea

dco

unt

Mill

ions

$

FY08 FY09 FY10

0

50

100

150

200

250

300

350

400

06 07 08 09 10 11 12 13 14 15 16

0

500

1000

1500

2000

2500

3000Escalated FTI Cost Targets

FY10 Actual Costs

FTI Headcount Targets

FY10 Q4 Headcount

KCRIMS Strategic Sourcing & Sizing

Strategic Sourcing and Sizing Plan:

NNSA Mission Space From ToManufacturing Space 1.26 M 0.65 MAdministrative Space 1.84 M 0.35 MTotal Usable Space 3.10 M 1.00 M

From ToMake Parts (approx) 3800 (46%) 1000 (35%)Buy Parts (approx) 4400 (54%) 1800 (65%)

Major Sourcing Activities:• Plating

• Cables

• General Machining

• Printed Wiring

Assemblies

• Injection, Compression, & Transfer Molding

• RTV Silicone & RTV Desiccant Molding

• Thermoforming

Major Process Changes:

• Liquid Spray Paint changing to Powder Coating

• Repackaging/Testing Carcinogen encapsulant

Note: Changes in total numbers due to W80 and B61 requirements changes.

FTI Accomplishments to Date

1. Shut down the Flexible Manufacturing System (FMS)

2. Eliminated the on-site Fire Department

3. Eliminated the Emergency Operations Center

4. Closed down and outsourced the Plating Department

5. Implemented additional outsourcing of products

6. Implemented new IT tools for Finance and Program Management

7. Consolidated store rooms/reduced inventory

8. Implemented Honeywell Operating System (HOS)

9. Implemented Fact-Based Quality (FBQ)

10. Executed co-sourcing plan for IT services

11. Transitioned HR & Staffing to HON Corporate model

12. Consolidated over 90 software applications

13. Implemented Engineering Support Specialist

14. Consolidated IT servers

15. Outsourced staffing administrative support

16. Implemented a facilities pause plan

17. Outsourced Medical Services and Carpenter Shop

18. Consolidated Waste Management Functions

19. EDSV Data Center shut down

Transition Governance Structure

Chris Gentile / Bill RossTransition Leads

New FacilityDan Fritts

RelocationDale Lock

Transition Program Management

KCRIMS - Rick LavelockFTI – Steve Halter

NSMC – Steve HalterNSMC Growth – Dave Lowe

Integrated Project Planning – Diana Blackburn*Communications – Sharon Robinson

Production Linda Wright HSE

DonFitzpatrick

PMRobertRepine

SecurityMike Ginder

Steve Zvacek

QualityRick

Vanhoose

ISCCurtisMearsBiz Ops

KevinBaughn

ITJohn Engel

PhilipClark

HRGina

Angello Lobaugh

SendingTeam Receiving

Team

BridgeFunctions

Transition Approval Committee(TAC)

Chris Gentile

Robin StubenhoferBill Ross

David Feather

Sourcing Linda Wright

Jim Jeffries

BradHughes

FacilitiesMike GinderBart Stuckey

NSMCProduction

Dan Grote

* *

*

*

***

Red denotes NSMC leader or co-leader

* denotes NSMC POC added to team

Production Linda Wright HSE

Curt Valle

PMRobertRepine

QualityRick

Vanhoose

ISCRick

VanhooseBiz OpsKevin

Baughn

ITJohn Engel

PhilipClark

HRGina

Angello LobaughKurtLorenzen

FacilitiesDenny Fulmer

Bart Stuckey

NSMCProduction

Lee Hoover

* *

**

**

Gloria ZarrellaBrian Fischer

Jeff Fuller

SecurityRussel BruchSteve Zvacek

Transition ProcessExpert

NNSA KCSO

NNSA HQ

HoneywellCorporate Oversight

Transition ProcessExpert

NNSA KCSO

NNSA HQ

HoneywellCorporate Oversight

Delivers reductions in infrastructure

costs while fulfilling NNSA mission requirements

Delivers reductions in infrastructure

costs while fulfilling NNSA mission requirements

Function Current(sq. ft.)

Future(sq. ft.)

Plating Facility 22,252 -

Refurbishment & Dismantlement 20,589 12,000

Rubber & Plastics Manufacturing 96,646 38,400

Paint & Heat Treat 24,533 10,000

Machining & Gas Transfer Systems 206,293 102,500

Assembly & Electrical Fabrication 227,583 162,450

Trailers 34,642 -

Special Material Production 25,256 22,300

Purchased & Other Inspection 44,125 34,500

Labs & Engineering Labs 160,898 73,300

Test Equipment, Gage Support & Metrology 66,240 29,700

Packaging & Shipping 27,604 20,800

Storage Areas 303,210 60,000

Sub - Total 1,259,871 565,950

Allocated White Space (Included Above) 21,050

Unallocated White Space 62,800

Total Manufacturing Space 628,750

KCRIMS Strategic Sizing Summary

Relocation PlanningMacro Plan Update Results

– Update to overall & phase durations – Move Phases: 105: KCRIMS – 100; NSMC - 5

– Changes/Additions to the Macro Plan (i.e. equipment quantities)

– Confirmation of departmental sequencing

– Factors in resource constraints

• Move Duration – Start dates following Security Transitions (Two months after bldg completion for KCRIMS, Four months for NSMC)

• KCRIMS: January 23, 2013 – August 7, 2014 (391 working days) ~18.5 Months• NSMC: September 10, 2013 – January 23, 2014 (93 working days) ~ 4.5 Months

KCRIMS/NSMC Project Summary

Reduces KCP operational cost by $100M annually (FY06 dollars)

Reduces KCP total footprint by over 50%, weapons funded space by 2/3rds

Project has positive cash flow (savings > costs) for entire duration

Reduces energy consumption by over 50%, LEED Gold sustainability

Flexible to accommodate any all anticipated stockpile scenarios

Lease allows easy adaptation of future NNSA business model

Comprehensively planned to assure schedule deliveries

Full and robust risk management program

Provides 1500 construction jobs and generates $1.2B of near term stimulus

Project Demonstrates Responsible GovernmentProject Demonstrates Responsible Government

KCP National Security Campus

Questions?